(CapitalWatch, July 27, New York) Magic Empire Global Ltd., a Hong Kong financial advisory firm, seeks a small initial public offering on the Nasdaq to expand its presence in the capital markets, including those in the U.S.
Magic Empire is an offshore holding whose operating subsidiary, Giraffe Capital, offers IPO sponsorship and financial advisory services, as well as compliance advisory and underwriting services in Hong Kong. It provides services to clients operating in a variety of industries including online ads and property development.
Founded in 2016, Giraffe Capital led eight IPO projects to completion as their sole sponsor, according to the prospectus, amended this week. Over the years 2021 and 2021, the firm participated in six IPO sponsorship projects, 31 financial advisory projects, 24 compliance advisory projects, and three underwriting projects.
In the year 2021, Magic Empire booked $2.2 million in revenue, that was a 17% decline year-over-year. IPO sponsorship services made up the majority of total revenues. The company has maintained profitability though, with $202,398 in net income for 2021 compared with $535,000 income for 2020.
Magic Empire said that during the year ended December 2021 its operating subsidiary was engaged in eight financial advisory projects for companies seeking listing in the U.S., while none of its IPO sponsorship projects made it to a public listing. This was a result of tough regulatory tightening by Beijing and the overall volatility of the Hong Kong capital markets amid the real estate crash and the ongoing Covid-19 troubles.
According to the prospectus, the firm plans to use half of the proceeds to expand its corporate finance advisory business across the markets, including the international capital markets and those in the United States. Magic Empire also intends to boost its asset management business, enhance its brand, and expand its offices, the prospectus said.
Magic Empire is offering 5 million of its ordinary shares at the expected price of $4 apiece, targeting to raise $20 million through its public listing.
The company expects to become publicly traded on the Nasdaq Capital Market under the symbol "MEGL." Network 1 Financial Securities, Inc. is the sole underwriter on the IPO.