Previously, we have outlined how a new system for Chinese businesses to enter the US and Canadian markets amid highly restrictive trans-border regulations, coining the term “Fusion Triangle”. The idea is that Chinese companies and individuals would purchase non-active shell companies that are already publicly listed on a lower-tier stock exchange, such as the “Over the Counter Markets” or “OTC Markets”. Granted, while the barriers to this is less restricted, one aspect that is challenging is the credibility – or lack-there-of – surrounding these lower-tier markets. The “Fusion Triangle” has now proven to increase the credibility of the US OTC Markets with a new merger that utilizes the “Fusion Triangle” which is now on course to be one of the largest Chinese-US mergers in OTC markets history.
With the announced merger slated for the 18th of Februray, 2020, investors should pay special attention to some of the finer details of the merger, that may have gone overlooked. Looking back in the company history, one aspect that sticks out is how Gerpang has poured significant resources into bio-pharmaceutical R&D, which is now one of the highest grossing Pharm-Tech industries in China.
This method has already shown to have been successful by Mr. Xu, with his recent mergers. Mr. Xu recently took over American based spirits company, South Beach Spirits Inc. (OTC:SBES), which is listed on the American “Over-the-Counter” markets. This is the latest in an attempt for successfull and credible Chinese businessmen manuvoering the “Fusion Triangle” in order to facilitate collaboration between emerging Chinese, Canadian and American companies. The connection between the two formulates a new wave of mergers from China to enter the North American markets.
From Bio-Pharm 1Av and other related sub-sections of the Bio-Pharm forum in 2019, Gerpang was mentioned, although largely missed because of its transition period during 2019. It will be interesting to see how well GP healthcare does compared to its rivals in 2020. This merger will act as its springboard to further bio-pharm acquisitions.
One new avenue we are particularly interested in is to see materialize is the connection to the “Life Science City”, as they released previously on their website.
Life Science City is not only an industrial city, but an industrial city that integrates bio-pharmaceuticals, medical devices, proton cancer treatment, and health care, and integrates industrial development and living therapy. Integrate the new district. In the future, there will be not only various types of industrial parks within this 60 square kilometers, but also 700 hectares of “Peach Garden” and health industry towns.
The above program is now connected with the Gerpang healthcare group. Shandong Gerpang Healthcare Medical Group and American CaroGen company formally signed an agreement to carry out the HBV hepatitis B virus vaccine project in Jinan High-tech Zone of Life Science City.
Very interestingly, the connection opens up an even bigger narrative for Gerpang and its recent merger announcement. We obtained the following from jhhg official website, that highlights 70 wholly owned subsidiaries with assets in excess of 47 Billion yuan.
The over-arching thesis is that with such a large merger, with a vast management team in China, the “Fusion Triangle” seems to be working in 2020 in bringing new investment dollars from China to the US and Canada. Additionally, the OTC Markets can now use this momentum to further strengthen their reputation as a legitimate player in the world stock exchanges for small to mid-cap companies hoping to raise money and expand their operations to be able to get listed on higher US exchanges such as the NYSE and NASDAQ stock exchanges.
Released Today and coming up next on IB: Report on how China is now targeting US and Canadian Cannabis Companies to By-Pass China’s regulations on THC products.