Alset Inc., a Texas-based real estate company, has finalized the purchase of 6.5 million shares of HWH International Inc. from its subsidiary Alset International Limited, according to a recent SEC filing. The transaction, which closed on November 20, 2024, involved issuing a secured promissory note valued at $4.095 million to Alset International Limited, with a 5% annual interest rate and a maturity date of September 26, 2026.
The stock purchase agreement, initially reported on September 27, 2024, was subject to stockholder approval from Alset International Limited, which was obtained on November 18, 2024. The shares acquired are of HWH International Inc., a Nasdaq-listed company under the control of Alset Inc.
This deal is notable for the interconnectedness of the involved entities. Alset Inc.'s Chairman and CEO, Chan Heng Fai, who is also the company's largest stockholder, holds the same positions at Alset International Limited and serves as the Chairman of the Board of HWH International Inc. His son, Moe Chan, is an officer and director at both Alset International Limited and Alset Inc. Additionally, three independent directors from Alset Inc. also serve as directors for HWH International Inc., illustrating the close ties between these organizations.
Alset Inc.'s Board of Directors has affirmed that the transaction is in the best interests of the company and its subsidiaries. The information in this article is based on the statements from the SEC filing by Alset Inc.
In other recent news, Texas-based real estate company Alset Inc. has completed a significant land sale and entered a stock purchase agreement. The company's subsidiary, 150 CCM Black Oak Ltd., finalized the sale of 72 single-family residential lots in Texas for approximately $3.9 million. This transaction underscores Alset Inc.'s ongoing strategic initiatives in the real estate market.
On another front, Alset Inc. has agreed to acquire 6,500,000 shares of HWH International Inc. from its majority-owned subsidiary, Alset International Limited. The acquisition, valued at around $4.1 million, is in exchange for a secured promissory note with an annual interest rate of 5%, maturing on September 26, 2026. This agreement is subject to approval by Alset International Limited's shareholders and other standard closing conditions.
These developments follow previous debt conversion agreements between HWH and its creditors, including Alset Inc. and Alset International Limited. The agreements converted roughly $3.8 million of HWH's debt into over 6 million new shares of HWH's common stock. Alset Inc.'s acquisition of HWH shares aligns with the interests of all parties involved, including HWH, Alset International Limited, and Alset Inc. itself.
InvestingPro Insights
To provide additional context to Alset Inc.'s recent acquisition of HWH International Inc. shares, let's examine some key financial metrics and insights from InvestingPro.
Alset Inc. (AEI) currently has a market capitalization of $10.25 million, reflecting its relatively small size in the real estate sector. The company's Price to Book ratio stands at a low 0.12, suggesting that the stock might be undervalued relative to its book value. This could be particularly relevant in light of the recent share purchase, as it may indicate that Alset Inc. sees potential value in consolidating its holdings in HWH International Inc.
InvestingPro Tips highlight that Alset Inc. holds more cash than debt on its balance sheet, which could have facilitated the $4.095 million promissory note issuance for the share purchase. However, the company is also quickly burning through cash, which investors should monitor given the new financial obligation.
It's worth noting that Alset Inc. has experienced a significant price uptick over the last six months, with a 109.92% total return. This positive momentum contrasts with its longer-term performance, as the stock has fared poorly over the last month and has fallen significantly over the last five years.
For readers interested in a more comprehensive analysis, InvestingPro offers 14 additional tips for Alset Inc., providing a deeper understanding of the company's financial health and market position.
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