CHANGSHA, China, Aug. 13, 2019 /PRNewswire/ -- Urban Tea, Inc. (NASDAQ: MYT) (the
"Company" or the "Buyer"), a premier retailer of
specialty teas and baked goods based in Hunan, China, is pleased to announce that the
Company, along with its wholly owned subsidiary Ming Yun Tang (Shanghai) Tea Co., Ltd. ("WOFE")
has entered into a non-binding Letter of Intent ("LOI")
with Hunan 39 PU Tea Co., Ltd. ("39 PU Tea") and equity
holders of 39 PU Tea to acquire 39 PU Tea. 39 PU Tea is a high-end
tea enterprise integrating tea distribution, product research and
development, and tea cultural heritage projects based in
Hunan, China.
Pursuant to the terms of the LOI, in consideration of 39 PU Tea
equity holders' agreement to enter into VIE Agreements with WOFE,
the Company will pay 39 PU Tea equity holders consideration
consisting of 70% paid in ordinary shares, no par value, of the
Company, and 30% paid in cash. The payment of the acquisition
consideration will be subject to 39 Pu's achievement of certain
operational milestones. As the transaction proceeds, the Company
will publicly disclose required information either through press
releases or SEC filings, as appropriate.
Mr. Long Yi, the Chief Executive
Officer of the Company stated: "Acquiring 39 PU Tea is an important
step for us, reflecting our strategy to expand our operations and
heighten the awareness of our brand in the fruit tea market. 39 PU
Tea complements our current business with its access to high
quality dark teas as well as its extensive operations designed to
spread tea culture through their tea academy. We are optimistic
that completing this acquisition will help broaden our customer
base and provide new options and opportunities for tea drinkers
across China."
Mr. De'an Hu, the Managing Director of 39 PU Tea commented:
"Urban Tea, Inc. shares our
commitment to tea culture and we are proud to join them to become
an industry leader in the specialty tea retail market. Our premium
dark tea has numerous desirable characteristics including health
benefits such as reducing blood pressure, can be easily stored, and
appreciates in value through the aging process. We believe these
characteristics will allow Urban
Tea, Inc. to benefit from our dark tea as a long-term supply
source for their innovative tea drinks."
Completion of the transaction is subject to due diligence
investigations by the relevant parties, the negotiation and
execution of a definitive share exchange agreement, satisfaction of
the conditions negotiated therein including the approval of the
Company's Board of Directors, approval by NASDAQ of issuance of the
share component of the acquisition consideration, and the
satisfaction of other customary closing conditions. There can be no
assurance that a definitive agreement will be entered into or that
the proposed transaction will be consummated. Further,
readers are cautioned that those portions of the LOI that describe
the proposed transaction, including the consideration to be issued
therein, are non-binding.
About Urban Tea, Inc.
Urban Tea, Inc. is an emerging
specialty tea product distributer and retailer headquartered in
Changsha City, Hunan Province, China. Through its wholly owned subsidiary,
Shanghai Ming Yun Tang Tea Limited ("Shanghai MYT") which
controls Hunan Ming Yun Tang Brand Management Co., Ltd. ("Hunan
MYT"), the Company currently market a wide range of trendy tea
drinks, light meals, and pastries targeting China's new urban generation in Hunan province. Our products are focused on
not only their taste but also their aesthetic presentation and
health benefits. Our products are currently being offered via our
own stores. We expect to start selling our products in our managed
and joint venture stores in October
2019. For more information, please visit:
ir.h-n-myt.com.
About Hunan 39 PU Tea
Co., Ltd.
Headquartered in Changsha,
Hunan, 39 PU Tea is a high-end tea
enterprise integrating tea distribution, product research and
development, and tea cultural heritage projects. The company aims
to create a comprehensive tea brand, selling premium tea (primarily
Anhua dark tea) and facilitating the dissemination of tea culture.
Currently, the company operates retail tea stores in Guangdong, Liaoning, Inner Mongolia, and Hunan. For more information, please visit:
www.39putea.com.
Forward-Looking Statements
Certain statements made herein are "forward-looking statements"
within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of words such as
"anticipate", "believe", "expect", "estimate", "plan", "outlook",
and "project" and other similar expressions that predict or
indicate future events or trends or that are not statements of
historical matters. Such forward-looking statements include timing
of the proposed transaction; the business plans, objectives,
expectations and intentions of the parties once the transaction is
complete, and the Company's estimated and future results of
operations, business strategies, competitive position, industry
environment and potential growth opportunities. These
forward-looking statements reflect the current analysis of existing
information and are subject to various risks and uncertainties. As
a result, caution must be exercised in relying on forward-looking
statements. Due to known and unknown risks, our actual results may
differ materially from our expectations or projections. All
forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by
these factors. Other than as required under the securities laws,
the Company does not assume a duty to update these forward-looking
statements.
The following factors, among others, could cause actual results
to differ materially from those described in these forward-looking
statements: the occurrence of any event, change or other
circumstances that could give rise to the terms of the LOI not
hereafter being memorialized in a definitive agreement; the outcome
of any legal proceedings that have been, or will be, instituted
against the Company or other parties to the LOI following
announcement of the LOI and transactions contemplated therein; the
ability of the Company to meet NASDAQ listing standards following
the transaction and in connection with the consummation thereof;
the inability to complete the transactions contemplated by the LOI
due to other closing conditions to; risks that the proposed
transaction disrupts current plans and operations and the potential
difficulties in employee retention as a result of the announcement
of the LOI and consummation of the transaction described therein;
costs related to the proposed acquisition; changes in applicable
laws or regulations; the ability of the combined company to meet
its financial and strategic goals, due to, among other things,
competition, the ability of the combined company to grow and manage
growth profitability, maintain relationships with customers and
retain its key employees; the possibility that the combined company
may be adversely affected by other economic, business, and/or
competitive factors; and other risks and uncertainties described
herein, as well as those risks and uncertainties discussed from
time to time in other reports and other public filings with the
Securities and Exchange Commission (the "SEC") by the
Company.
Additional information concerning these and other factors that
may impact our expectations and projections can be found in our
periodic filings with the SEC, including our Annual Report on Form
20-F for the fiscal year ended June 30,
2018 as well as our Current Report on Form 6-K dated
April22, 2019. The Company's SEC filings are available publicly on
the SEC's website at www.sec.gov. The Company disclaims any
obligation to update the forward-looking statements, whether as a
result of new information, future events or otherwise.
Non-Solicitation
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy the securities of the Company, nor
shall there be any sale of any such securities in any state or
jurisdiction in which such offer, solicitation, or sale would be
unlawful prior to registration or qualification under the
securities laws of such state or jurisdiction. No offer of
securities shall be made except by means of a prospectus meeting
the requirements of Section 10 of the Securities Act of 1933, as
amended.
For more information, please contact investor
relations:
Tina Xiao
Ascent Investor Relations LLC
Phone: +1-917-609-0333
Email: tina.xiao@ascent-ir.com
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SOURCE Urban Tea Inc.