PHOE · Phoenix Asia Holdings Limited Ordinary Shares

Phoenix Asia Holdings Limited, currently engaged in Hong Kong substructure works, announced a transformative transaction to acquire ACEA Pharma, Inc., a clinical-stage pharmaceutical company developing treatments for cancer, autoimmune diseases, and Covid-19. The deal involves issuing 100 million newly-issued ordinary shares to ACEA Therapeutics, Inc., valued contractually at $1 billion for purposes including tax treatment under Section 351(a) and SEC reporting, though explicitly not representing fair market value. This all-stock transaction positions Phoenix Asia to pivot into the pharmaceutical sector, with the press release stating intent to become a pharma holding company post-closing. Closing is targeted for Q2 2026 but hinges on critical approvals: HSR antitrust clearance and Nasdaq review for the share issuance, which could trigger reverse takeover scrutiny given the transaction scale relative to the company's current profile. Concurrently, Phoenix Asia issued a $20 million zero-interest convertible note to its controlling shareholder, Phoenix Prosperity Investment Limited, as payment for advisory services supporting financing activities. The note's senior status prioritizes repayment over other debt, features no prepayment penalties, and offers conversion into ordinary shares at $10.00 each until the third anniversary on May 4, 2029, or earlier upon default events like insolvency. Both the note and potential conversion shares are restricted securities under Regulation S, targeting non-U.S. accredited investors. Investors should note the related-party nature of the note and the stock acquisition's magnitude, which could significantly dilute existing shareholders upon closing while introducing pharma assets with clinical-stage risks.