Professional Diversity Network Inc.'s variable interest entity Jiangxi PDN Culture Media Co. Ltd. agreed to acquire majority stakes in two education companies based in China.
Under the deal, Professional Diversity Network will issue 915,864 common shares at a price equal to US$1.50 per share for a total valuation of about US$1.4 million in exchange for a 51% stake each in nonprofit business Guangzhou Zengcheng District Zhili Education Training Center and limited liability company Guangzhou Angyue Education Consulting Co. Ltd.
Shareholder Yuman Hu will retain a 49% ownership stake in each of the target companies and will manage the day-to-day affairs.
The equity swap shares will be issued to the sellers in four equal installments, with the first installment to be issued within 20 business days of the closing and the remaining three installments to be issued between March 15 and April 15 of 2021, 2022 and 2023, respectively.
The transaction came three months after Professional Diversity Network formed a new subsidiary to enter China's education market.
