ISOTeam, a Singapore-listed company that owns 51 percent of SG Bike, said the bike-sharing startup has entered into an asset transfer agreement with Singapore Mobike Pte Ltd and Mobike Ltd, under which SG Bike will assume the liabilities of Singapore Mobike.
In Singapore, Mobike is licensed to operate 25,000 shared bikes. This license will be transferred to SG Bike following the agreement.
Aside from the license, SG Bike will also pay the security deposit paid by Mobike to the Land Transportation Authority of Singapore in an amount of $550,000. The Singapore startup will also pay $422,800 for the 25,000 bicycles, each with the IoT smart lock installed, from Mobike.
“Mobike also agrees to facilitate the user migration to SG Bike’s application platform and also not to directly or indirectly seek to repay or reduce any user deposits and prepayments,” according to the announcement.
The transaction still requires approval from Singapore authorities.
Singapore Mobike is a wholly-owned subsidiary of Mobike (Hong Kong) Limited, which in turn a wholly-owned subsidiary of Mobike, the Beijing-headquartered fully station-less bike-sharing firm.
ISOTeam said the proposed acquisition will allow SG Bike to further grow its business and by increasing its fleet of bikes. This will, in turn, promote an active and environment-friendly lifestyle in Singapore.
Likewise, the acquisition of Mobike will also enable SG Bike to widen its foothold as Singapore’s leader in the bike-sharing industry.
The purchase consideration of $1.85 million will be funded through a Singapore incorporated private limited company, by granting a S$2,000,000 loan to ISOTeam, which will in turn sub-loan the same to SG Bike.
The balance amount of approximately S$540,725 will be paid by the other shareholders of SG Bike on a pro rata basis. The assumed liabilities of an aggregate amount not exceeding $1.5 million will be funded by borrowings.