Chenghe Acquisition II Co., a blank check company incorporated in the Cayman Islands, has reported its financial performance for the fiscal year ending December 31, 2024, in its recent 10-K filing. The company completed its initial public offering (IPO) on June 10, 2024, raising gross proceeds of $86.25 million from the sale of 8,625,000 units, which included the underwriters' over-allotment option. Following the IPO, the company placed approximately $86.25 million into a trust account, which is intended to be used for its initial business combination. As of December 31, 2024, the trust account held approximately $88.64 million in marketable securities, including interest income.
In terms of profitability, Chenghe Acquisition II Co. reported a net loss of $1.19 million for the period from its inception on January 15, 2024, through December 31, 2024. This loss was primarily attributed to operating costs of $3.58 million, which were partially offset by interest income of $2.39 million from the trust account. The company has not yet engaged in any operations or generated revenue, as it is still in the process of identifying a target for its initial business combination.
Strategically, Chenghe Acquisition II Co. has entered into a Business Combination Agreement with Polibeli Group Ltd. on September 16, 2024. This agreement outlines the merger of Polibeli with Chenghe, with Chenghe becoming a wholly-owned subsidiary of Polibeli. The completion of this business combination is subject to various conditions, including regulatory approvals and shareholder votes. The company has until June 12, 2026, to complete this business combination, or it will be required to liquidate and return funds to shareholders.
Operationally, the company has reported a working capital deficit of $2.61 million as of December 31, 2024, with cash available outside the trust account amounting to $251,105. The company intends to use these funds primarily for identifying and evaluating target businesses, conducting due diligence, and covering transaction costs. Chenghe Acquisition II Co. has also indicated that it may seek additional financing through loans from its sponsor or affiliates to support its operations and business combination efforts.
Looking ahead, Chenghe Acquisition II Co. faces several risks and uncertainties, particularly related to its ability to complete the proposed business combination with Polibeli and the potential regulatory challenges associated with acquiring a target company in China. The company has acknowledged that geopolitical tensions and changes in regulatory environments could impact its operations and the value of its securities. As it moves forward, the company will continue to assess potential acquisition targets and navigate the complexities of the market to achieve its business objectives.
About Chenghe Acquisition II Co.
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