Recently, Haiwen Hong Kong assisted Newborn Town Inc. (“Newborn Town”, 9911.HK) in completing the acquisition (the “Acquisition”) of the entire issued share capital of Chizicheng Strategy Investment Limited (“Chizicheng Strategy Investment”) and in undergoing, for BlueCity Holdings Limited (“BlueCity”), a company previously listed on the NASDAQ before its privatisation, and its affiliates, reorganisation of their VIE (Variable Interest Entity) structure.As the controlling shareholder of BlueCity, Metaclass Management ELP (the “Fund”) was established for its privatisation and is exclusively managed by Chizicheng Strategy Investment as its general partner. Upon completion of the Acquisition, Newborn Town will, through its control of the general partner of the Fund and via the interests so held by it as the limited partner of the Fund, exert full control over the Fund, and thus consolidate the financial results of the Fund and the companies held by the Fund, including BlueCity and its affiliates.Newborn Town focuses on the global open social networking sector, as well as emerging modes in social networking including video and audio formats, creating a range of diversified social networking products including video social networking, audio social networking and live-streaming social networking. Its representative products include Yumy, MICO and YoHo, which are highly popular in areas such as the Middle East, North America, Southeast Asia and South Asia. BlueCity has accumulated a vast user base in many regions worldwide and occupies a leading position in the global LGBTQ social networking market. In view of the development potential and prospects of the LGBTQ community in the social networking field, as well as the high compatibility between the business models of both parties, it is expected that both parties will benefit from the synergies brought about by the Acquisition. As such, it will, in turn, enable Newborn Town to fully and more effectively support the continued growth and profitability of BlueCity’s business going forward.Upon completion of the Acquisition, by drawing on BlueCity’s unique appeal to the LGBTQ community, Newborn Town would benefit from enhanced brand influence, awareness and recognition whilst achieving growth through the expansion and diversification of user base, thereby leading to a wider scope of service offerings and a surge in business opportunities which could fuel future growth of Newborn Town in terms of market share and profitability.As the Hong Kong legal adviser to Newborn Town, Haiwen Hong Kong has taken on the important role of planning and coordinating the project to fully accommodate the needs of its client, as well as timely communicating and exchanging views with various professional parties on the relevant laws and regulations and other material issues involved in the project. With its solid understanding of Hong Kong laws and regulations and the rules and guidelines of various regulatory bodies, as well as extensive experience in transactional legal services, Haiwen Hong Kong provided professional legal advice and timely and appropriate solutions to its client on transactional structure design, drafting and reviewing of transaction documents, preparation of public information disclosure documents, waiver applications, and communication with regulatory authorities, etc. which are instrumental to the successful completion of the project. Haiwen Hong Kong has received high acclaim from its client for the high-quality and efficient legal services provided.
The team from Haiwen advising on this transaction was led by international partner Isaac Chen, and assisted by associates Anna Mak and Aiye Jia.
