Editor’s note: Updated with additional information on Wellous’ market value upon listing.

Wellous Group Ltd, a fast-growing Asia-based international nutrition company that develops, manufactures, markets and sells health and wellness products, and Kairous Acquisition Corp. Ltd, a publicly traded special purpose acquisition company (SPAC) on NASDAQ, announced on Tuesday that they have entered into a definitive merger agreement that will result in Wellous becoming a publicly listed company upon the closing of the transaction.

Upon closing, the combined company will be renamed “Wellous Group Holdings Ltd” (the combined company) and expects to list its ordinary shares on NASDAQ. The combined company is set to have a market value of at least $304 million upon listing, depending on the outcome of the final redemption, Kairous Acquisition told TechNode Global.

According to the merger agreement, the merger consideration is $270 million, payable by newly-issued securities of the combined company valued at $10.10 per share. Additional earnout shares may be issuable to Wellous stockholders after closing, upon achievement of certain trading price-based and/or profitability targets.

Cash proceeds raised will consist of Kairous’s approximately $21 million in trust (assuming no redemptions by Kairous’s existing public shareholders) which is anticipated to support the company’s growth capital needs and to be used for general working capital purposes.

After the closing, Wellous shareholders are expected to retain a majority of the outstanding shares of the combined company and Wellous will designate a majority of proposed directors for the combined company’s board.

The Wellous management team, led by its Co-Founders Andy Tan and Henry Chin, will continue to run the combined company after the closing of the proposed transaction.

“Over the past decade, I have evaluated over a thousand fast-growing companies in Asia, and I believe that Wellous is a hidden gem. The company understands the high-growth consumer wellness and nutrition industry in Asia, and successfully found the right brand story, products and marketing strategy to serve rising middle-income consumers,” Joseph Lee, CEO of Kairous Acquisition said in a statement. “By innovatively leveraging on social techpreneurs and supporting them with its proprietary tech stacks, Wellous’ business model is highly scalable across different markets. Wellous is a testament to the global investor community that Southeast Asia companies are capable of being profitable while maintaining high growth. With the proposed transaction, we strongly believe Wellous will grow stronger and increase its grand recognition internationally.”

Founded in 2016, Wellous is a health food and nutrition company that develops, manufactures, markets and distributes trusted and beneficial health and wellness products. The company said it offers only the best of nature, the most precious ingredients from a wide sourcing network. Based in Malaysia, Wellous’s products and services are distributed through its tech-enabled distribution channels.
The company has a strong footprint in the Asia-Pacific markets and growing presences in other markets across the world.

“Wellous strives to bring its high quality, innovative and tailored health products across the world, and we are targeting future expansion opportunities in markets which go beyond Southeast Asia”, Tan said.

“We see a vast addressable market, totaling approximately $700 billion annually by 2027, as provided in a study by Grand View Research, due to increased demand for food and supplements that provide health benefits tailored to specific individual needs”, Chin said.

According to the statement, the boards of directors of both Wellous and Kairous have unanimously approved the proposed transaction, which is expected to be completed in mid–2023, subject to approval by Kairous’ and Wellous’ shareholders, regulatory approvals, among satisfaction of other conditions.

Chardan is serving as M&A and Capital Markets advisor and Loeb & Loeb LLP is serving as legal advisor to Kairous. Robinson & Cole LLP is serving as legal advisor to Wellous. ICR is serving as Investor Relations and Public Relations for the proposed transaction.

Kairous Acquisition Corp. Ltd is an Asia-focused special purpose acquisition company (SPAC) led by Joseph Lee, the founder and Managing Partner of Malaysia-based Kairous Capital. Kairous Capital is a regional venture firm focused on technology investments across China and Southeast Asia.

Kairous Capital is an investor in TechNode Global.

Malaysia-based SPAC Kairous Acquisition starts trading on NASDAQ