- Ucommune was founded in 2015, with early investors including
Sequoia Capital China, Matrix Partners China, Sinovation Ventures,
and Zhenfund. Ucommune has become the largest agile office space
manager and co-working community operator in China with more than 700,000 members across
211 office spaces in Greater China
and Singapore.[1]
- Ucommune generated revenues of 1,179
million RMB (approximately $170
million in USD) in 2019 (unaudited), and revenues grew over
160% from 2018 to 2019.[2] Management estimates the
Company will generate revenues of 1,350
million RMB (approximately $190
million in USD) and 2,100 million
RMB (approximately $295
million in USD) in 2021 and 2022 respectively.
- The combined company will have a pro forma firm value of
approximately $769 million at closing
or 2.58x 2022 net revenue, assuming no shareholder redemption and
the Company receives $44.8 million
cash[3] from Orisun's trust account.
NEW YORK, July 6, 2020 /PRNewswire/ -- Orisun
Acquisition Corp. ("Orisun") (NASDAQ: ORSN, ORSNU, ORSNW,
ORSNR), a special purpose acquisition company, announced today
that it has entered into a definitive merger agreement (the "Merger
Agreement") for a business combination with Ucommune Group Holdings
Limited ("Ucommune" or the "Company"), a leading agile office space
manager and provider in China. Upon consummation of the
transaction contemplated by the Merger Agreement, (i) Orisun will
reincorporate to Cayman Islands by
merging with and into Ucommune International Ltd, a Cayman Islands exempted company and wholly
owned subsidiary of Orisun ("Ucommune International"), and (ii)
concurrently with the reincorporation merger, Everstone
International Ltd ("Merger Sub"), a Cayman Islands exempted company and wholly
owned subsidiary of Ucommune International, will be merged with and
into Ucommune, resulting Ucommune being a wholly owned subsidiary
of Ucommune International. Upon the closing of the transactions,
the parties plan to remain NASDAQ-listed under a new ticker
symbol.
Founded in 2015, Ucommune currently has more than 700,000
members and more than 94,000 work stations across 211 office spaces
in Greater China and Singapore with an aggregate managed area of
686,000 square meters (approximately 7.38 million square feet) as
of December 31, 2019. Since its
inception, Ucommune has been developing an asset-light model under
which Ucommune provides space design, renovation, and management
services to develop and manage agile office spaces for landlords
who contribute most of the capital investments needed to build out
and launch new spaces. In addition to agile office space services,
Ucommune cooperates with over 700 business partners to offer its
members additional revenue generating services including
advertising and branding services, catering, fitness, healthcare,
training and entertainment as well as general corporate services,
such as corporate secretary, human resources, legal, finance, IT
support and tax services. Ucommune's existing investor base
includes Sequoia Capital China, Matrix Partners China, Sinovation
Ventures, ZhenFund, and Gopher Asset Management.
The Company's revenues grew over 160% from 2018 to 2019. In
2020, the Company expects to experience modest revenue decline due
to the COVID-19 pandemic. Ucommune has already seen improved
revenues in recent weeks . Management forecasts an approximately
66% CAGR of revenues between 2017 and 2022.
According to Frost & Sullivan, the addressable Agile Office
Space Industry in China is
132 billion RMB (approximately
$19 billion in USD).[1]
The market grew at a compound annual growth rate, or CAGR, of 72%
from 2013 to 2018, and is estimated to grow at a CAGR of 50% from
2018 to 1.03 trillion RMB
(approximately $146 billion in USD)
by 2023.
Ucommune's current management team will continue running the
Company after the transaction.
"We are excited to combine Orisun with Ucommune and admire the
Company that Mr. Daqing Mao and the
Ucommune management team have built" said Wei Chen, Chairwoman of Orisun. "I look forward
to working with Ucommune's dynamic management team to help them
thrive as a public company while they continue to grow."
Daqing Mao, Founder of Ucommune,
commented, "We are thrilled to enter into the Merger Agreement with
Orisun, and today's announcement marks a key milestone for
Ucommune. This transaction directly aligns with our strategic
objectives, and will unleash the exciting potential of our new
growth initiatives, including the expansion of our asset-light
model. As a publicly listed company, we look forward to
strengthening our market leading position and to expanding our
footprint in China. With smart
technology and efficient business operations, we will continue to
empower more members in communities across China, unleashing their potential and creating
maximum value for society."
[1] According to Frost &
Sullivan's report on November 9, 2019, in terms of the number of
agile office spaces, aggregate managed area and number of cities
covered in China as of September 30, 2019.
|
[2] According to the unaudited
financial statements of Ucommune.
|
[3] According to the number as of
03/31/2020.
|
Key Transaction Terms
Under the terms of the Merger Agreement, Orisun's wholly owned
subsidiary Ucommune International will acquire Ucommune, resulting
in Ucommune International being a listed company on the Nasdaq
Capital Market. At the effective time of the transactions,
Ucommune's shareholders and management will receive 70 million
ordinary shares of Ucommune International. In addition, Ucommune
shareholders will be entitled to receive earn-out consideration of
up to an additional four million ordinary shares of Ucommune
International, subject to Ucommune exceeding certain net revenue
targets in 2020, 2021 and 2022 or achieving certain share price
thresholds prior to certain future dates as set forth in the Merger
Agreement. All shares held by existing Ucommune shareholders will
be subject to lock-up agreements for a period of at the least six
(6) months following closing of the transaction, subject to certain
exceptions.
The combined company represents a pro forma market value of
approximately $769 million at
closing, or 2.58x 2022 estimated net revenue, assuming no
shareholder redemption and the Company receiving $44.8 million cash from Orisun's trust
account.
Chardan is acting as an M&A and financial advisor to
Orisun. Loeb & Loeb LLP is acting as legal advisor to
Orisun. Davis Polk & Wardwell
LLP is acting as the legal advisor to Ucommune.
The description of the transaction contained herein is only a
summary and is qualified in its entirety by reference to the Merger
Agreement relating to the transaction, a copy of which will be
filed by Orisun with the SEC as an exhibit to a Current Report on
Form 8-K.
About Ucommune
Ucommune is China's leading
agile office space manager and provider. As of December 31, 2019, Ucommune managed 211 agile
office spaces in 46 cities in Greater
China and Singapore.
Ucommune's offline agile office space services include
self-operated models of U Space, U Studio and U Design, as well as
asset-light models U Brand and U Partner. Founded in 2015, Ucommune
has created a large-scale intelligent agile office ecosystem where
its members can leverage its network to reach their full potential
and collectively create maximum value.
About Orisun Acquisition Corp.
Orisun Acquisition Corp. is incorporated in the State of Delaware as a blank check company for
the purpose of entering into a merger, share exchange, asset
acquisition, share purchase, recapitalization, reorganization or
similar business combination with one or more businesses or
entities. Orisun's efforts to identify a prospective target
business have not been limited to a particular industry or
geographic region, although Orisun intended to focus on targets
located in China.
Forward-Looking Statements
This press release contains, and certain oral statements made by
representatives of Orisun, Ucommune, and their respective
affiliates, from time to time may contain, "forward-looking
statements" within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. Orisun's and
Ucommune's actual results may differ from their expectations,
estimates and projections and consequently, you should not rely on
these forward-looking statements as predictions of future events.
Words such as "expect," "estimate," "project," "budget,"
"forecast," "anticipate," "intend," "plan," "may," "will," "could,"
"should," "believes," "predicts," "potential," "might" and
"continues," and similar expressions are intended to identify such
forward-looking statements. These forward-looking statements
include, without limitation, Orisun's and Ucommune's expectations
with respect to future performance and anticipated financial
impacts of the business combination, the satisfaction of the
closing conditions to the business combination and the timing of
the completion of the business combination. These forward-looking
statements involve significant risks and uncertainties that could
cause actual results to differ materially from expected results.
Most of these factors are outside the control of Orisun or Ucommune
and are difficult to predict. Factors that may cause such
differences include, but are not limited to: (1) the occurrence of
any event, change or other circumstances that could give rise to
the termination of the Merger Agreement relating to the proposed
business combination; (2) the outcome of any legal proceedings that
may be instituted against Orisun or Ucommune following the
announcement of the Merger Agreement and the transactions
contemplated therein; (3) the inability to complete the business
combination, including due to failure to obtain approval of the
shareholders of Orisun or other conditions to closing in the Merger
Agreement; (4) delays in obtaining or the inability to obtain
necessary regulatory approvals (including approval from insurance
regulators) required to complete the transactions contemplated by
the Merger Agreement; (5) the occurrence of any event, change or
other circumstance that could give rise to the termination of the
Merger Agreement or could otherwise cause the transaction to fail
to close; (6) the inability to obtain or maintain the listing of
the post-acquisition company's ordinary shares on NASDAQ following
the business combination; (7) the risk that the business
combination disrupts current plans and operations as a result of
the announcement and consummation of the business combination; (8)
the ability to recognize the anticipated benefits of the business
combination, which may be affected by, among other things,
competition, the ability of the combined company to grow and manage
growth profitably and retain its key employees; (9) costs related
to the business combination; (10) changes in applicable laws or
regulations; (11) the possibility that Ucommune or the combined
company may be adversely affected by other economic, business,
and/or competitive factors; and (12) other risks and uncertainties
to be identified in the Form F-4 filed by Ucommune International
(when available) relating to the business combination, including
those under "Risk Factors" therein, and in other filings with the
Securities and Exchange Commission ("SEC") made by Orisun and
Ucommune. Orisun and Ucommune caution that the foregoing list of
factors is not exclusive. Orisun and Ucommune caution readers not
to place undue reliance upon any forward-looking statements, which
speak only as of the date made. Neither Orisun or Ucommune
undertakes or accepts any obligation or undertaking to release
publicly any updates or revisions to any forward-looking statements
to reflect any change in its expectations or any change in events,
conditions or circumstances on which any such statement is based,
subject to applicable law. The information contained in any website
referenced herein is not, and shall not be deemed to be, part of or
incorporated into this press release.
Important Information
Ucommune International Ltd. ("Ucommune International "), Orisun
Acquisition Corp. ("Orisun"), and their respective directors,
executive officers and employees and other persons may be deemed to
be participants in the solicitation of proxies from the holders of
Orisun common stock in respect of the proposed transaction
described herein. Information about Orisun's directors and
executive officers and their ownership of Orisun's common stock is
set forth in Orisun's Annual Report on Form 10-K filed with the
SEC, as modified or supplemented by any Form 3 or Form 4 filed with
the SEC since the date of such filing. Other information regarding
the interests of the participants in the proxy solicitation will be
included in the Form F-4 pertaining to the proposed transaction
when it becomes available. These documents can be obtained free of
charge from the sources indicated below.
In connection with the transaction described herein, Ucommune
International will file relevant materials with the SEC including a
Registration Statement on Form F-4. Promptly after the registration
statement is declared effective, Orisun will mail the proxy
statement/prospectus and a proxy card to each stockholder entitled
to vote at the special meeting relating to the transaction.
INVESTORS AND SECURITY HOLDERS OF ORISUN ARE URGED TO READ THESE
MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY
OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTION THAT
ORISUN WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ORISUN, UCOMMUNE AND
THE TRANSACTION. The proxy statement/prospectus and other relevant
materials in connection with the transaction (when they become
available), and any other documents filed by Orisun with the SEC,
may be obtained free of charge at the SEC's website
(www.sec.gov).
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SOURCE Orisun Acquisition Corp.