Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
References to the “Company”, “us”, “our”, or “we” refer to Bukit Jalil Global Acquisition 1 Ltd. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and related notes herein.
The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related thereto which are included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Special Note Regarding Forward-Looking Statements,” “Item 1A. Risk Factors” and elsewhere in this Annual Report on Form 10-K.
Overview
We are a blank check company formed under the laws of Cayman Island on September 15, 2022, for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more businesses. We intend to effectuate our business combination using cash derived from the proceeds of the initial public offering (the “IPO”), our securities, debt or a combination of cash, securities and debt, in effecting a business combination. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location.
We presently have no revenue, have had losses since inception from incurring formation and operating costs and have had no operations other than identifying and evaluating suitable acquisition transaction candidates. We have relied upon the working capital available to us following the consummation of the IPO and the Private Placement (as defined below) to fund our operations, as well as the funds loaned by the Sponsor (as defined below), our officers, directors or their affiliates. We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to raise capital or to complete our initial business combination will be successful.
On June 30, 2023, we consummated the IPO of 5,750,000 units (including 750,000 units issued upon the full exercise of the over-allotment option, the “Public Units”). Each Public Unit consists of one ordinary share, $0.0001 par value per share (the “Ordinary Shares”), one-half of one redeemable warrant (the “Warrant”), each whole Warrant entitling the holder thereof to purchase one Ordinary Share at an exercise price of $11.50 per share, and one right (the “Right”), each one Right entitling the holder thereof to exchange for one-tenth of one Ordinary Share upon the completion of our initial business combination. The Public Units were sold at an offering price of $10.00 per Public Unit, generating gross proceeds of $57,500,000.
On June 30, 2023, substantially concurrently with the closing of the IPO, we completed the private sale (the “Private Placement”) of 424,307 units (the “Private Units”) to the Company’s sponsor, Bukit Jalil Global Investment Ltd. (the “Sponsor”), at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $4,243,070.
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The proceeds of $58,362,500 ($10.15 per Public Unit) in the aggregate from the IPO and the Private Placement, were placed in a trust account (the “Trust Account”) established for the benefit of the Company’s public shareholders and the underwriters of the IPO with Continental Stock Transfer & Trust Company acting as trustee.
Recent Development
Proposed Business Combination with GIBO
As previously disclosed in the Company’s Current Report on Form 8-K filed on August 9, 2024, the Company entered into a Business Combination Agreement dated August 5, 2024 (as may be amended, supplemented, or otherwise modified from time to time, the “Business Combination Agreement”), with GIBO HOLDINGS LIMITED, a Cayman Islands exempted company limited by shares (“PubCo”), GIBO Merger Sub 1 Limited, a Cayman Islands exempted company limited by shares (“Merger Sub I”), GIBO Merger Sub 2 Limited, a Cayman Islands exempted company limited by shares (“Merger Sub II”), and Global IBO Group Ltd., a Cayman Islands exempted company limited by shares (“GIBO”), pursuant to which, among other things, (i) Merger Sub I will merge with and into GIBO, with GIBO as the surviving entity and a wholly-owned subsidiary of PubCo (the “First Merger”), and (ii) following the First Merger, Merger Sub II will merge with and into BUJA, with BUJA as the surviving entity and a wholly-owned subsidiary of PubCo (the “Second Merger,” and together with the First Merger and the other transactions contemplated by the Business Combination Agreement, the “Business Combination”). Upon the consummation of the Business Combination, each of BUJA and GIBO will become a subsidiary of PubCo, and BUJA’s shareholders and GIBO’s shareholders (except certain shareholders of the Company (such shareholders, the “Founders”)) will receive Class A ordinary shares of par value of $0.000001 each of PubCo (“PubCo Class A Ordinary Shares”) and the Founders will receive Class B ordinary shares of par value of $0.000001 each of PubCo (“PubCo Class B Ordinary Shares” and together with PubCo Class A Ordinary Shares, “PubCo Ordinary Shares”) as consideration and become the shareholders of PubCo. Each PubCo Class A Ordinary Share shall entitle the holder thereof to one (1) vote on all matters subject to vote at general meetings of PubCo while each PubCo Class B Ordinary Share shall entitle the holder thereof to twenty (20) votes on all matters subject to vote at general meetings of PubCo. Each PubCo Class B Ordinary Share is convertible into one (1) PubCo Class A Ordinary Share at any time at the option of the holder thereof and PubCo Class A Ordinary Shares are not convertible into PubCo Class B Ordinary Shares under any circumstances. The date of each of the First Merger and the Second Merger is hereinafter referred to as the “First Date” and the “Second Date” respectively. The Company expects PubCo Class A Ordinary Shares be listed and traded on the Nasdaq Stock Market LLC (“Nasdaq”) following the consummation of the Business Combination.
In connection with the Business Combination, PubCo has filed with the SEC a registration statement on Form F-4 (File No. 333-285183), which was declared effective on March 12, 2025 (as amended from time to time, the “Form F-4”), and the Company filed a definitive proxy statement (the “Proxy Statement”) for the solicitation of proxies in connection with an extraordinary general meeting of the Company’s shareholders on March 12, 2025.
On March 31, 2025, the Company held an extraordinary general meeting (the “Extraordinary General Meeting”) in connection with the Business Combination. The shareholders approved following proposals, to approve by special resolutions:
(a) the Business Combination Agreement and (ii) other Transaction Documents (as defined in the Business Combination Agreement) be approved, ratified and confirmed in all respects;
(b) the Business Combination which includes the Second Merger and other transactions contemplated in the Business Combination Agreement be approved, ratified and confirmed in all respects;
(c) the plan of second merger in relation to the Second Merger and the filing of the plan of second merger with the Registrar of Companies of the Cayman Islands be approved, ratified and confirmed in all respects;
(d) with effect from the Second Merger Effective Time (as defined in the Business Combination Agreement), the re-designation and reclassification of the authorized issued and unissued 10,000,000 preference shares of a par value of US$0.0001 each into 10,000,000 ordinary shares of a par value of US$0.0001 each (the “Re-designation”) such that following the Re-designation, the authorized share capital of BUJA shall be changed from US$50,000 divided into 490,000,000 ordinary shares of a par value of US$0.0001 each and 10,000,000 preference shares of a par value of US$0.0001 each to US$50,000 divided into 500,000,000 shares of a nominal or par value of US$0.0001 each be approved, ratified and confirmed in all respects;
(e) with effect from the Second Merger Effective Time (as defined in the Business Combination Agreement), the amendment and restatement of the amended and restated memorandum and articles of association of BUJA by the deletion in their entirety and substitution in their place of the second amended and restated memorandum and articles of association of BUJA be approved, ratified and confirmed in all respects, and
(f) with effect from the Second Merger Effective Time (as defined in the Business Combination Agreement), the appointment of LIM Chun Yen as the sole director of BUJA be approved, ratified and confirmed in all respects
In connection with the Extraordinary General Meeting, as of March 27, 2025, the cut-off date of the redemption request, 2,832,423 ordinary shares of BUJA were rendered for redemption.
Extension, Amendments to Articles of Incorporation or Bylaws and Trust Agreement Amendment
On June 29, 2024, the Company held an extraordinary general meeting (the “Extraordinary Meeting”), where the shareholders of the Company approved the proposal (the “MAA Amendment Proposal”) to amend Articles 48.7 and 48.8 of the Company’s Amended and Restated Memorandum and Articles of Association (the “Then Current MAA”) to provide that the Company must (i) consummate a business combination, or (ii) cease its operations except for the purpose of winding up if it fails to complete such Business Combination and redeem or repurchase 100% of the Company’s public shares included as part of the public units issued in the Company’s initial public offering, by June 30, 2024 (the “Termination Date”), and if the Company does not consummate a business combination by June 30 2024, the Termination Date may be extended up to twelve times, each by a Monthly Extension, for a total of up to twelve months to June 30, 2025, without the need for any further approval of the Company’s shareholders (the “Extension”).
In addition, at the Extraordinary Meeting, the shareholders of the Company also approved the proposal (“NTA Requirement Amendment Proposal”) to amend Articles 48.2, 48.4, 48.5, and 48.8 of the Then Current MAA (such amendment, together with the amendment mentioned in the last paragraph, the “MAA Amendment”) to eliminate the limitation that the Company may not redeem the Company’s public shares in an amount that would cause the Company’s net tangible assets to be less than US$5,000,001 following such redemptions.
In connection with the MMA Amendment, the Company and Continental Stock Transfer & Trust Company, a New York limited purpose trust company (the “Trustee”) amended the Investment Management Trust Agreement dated June 27, 2023 (the “Trust Agreement”), to provide that the Trustee must commence liquidation of the Company’s Trust Account by the 12-month anniversary of the closing of the IPO, or, in the event that the Company extended ( on a monthly basis), the time to complete the business combination for up to 24-month from the closing of the IPO (each of such monthly extensions, the “Monthly Extension”) but has not completed the business combination within the applicable monthly anniversary of the closing of the IPO. In connection with the MAA Amendment Proposal and the NTA Requirement Amendment Proposal, 2,820,485 ordinary shares of the Company were rendered for redemption, and $30,153,549.88 were paid to the redeeming shareholders accordingly in July 2024.
Monthly Extension Deposit and Notes
To effectuate each Monthly Extension, on or about July 1, 2024, the Sponsor deposited the monthly extension fee in the amount of $100,000 for all remaining public shares in the Trust Account (the “July 2024 Extension Payment”) so that the Company has until July 30, 2024 to complete its initial business combination. In connection with the July 2024 Extension Payment, the Company issued to the Sponsor an unsecured promissory note of $100,000 (the “July 2024 Extension Note”).
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On August 1, 2024, the Sponsor deposited $100,000 into the Trust Account (the “August 2024 Extension Payment”) resulting in the Company having until August 30, 2024 to complete its initial business combination. The Company issued to the Sponsor an unsecured promissory note of $100,000 (the “August 2024 Extension Note”).
On August 28, 2024, the Sponsor deposited $100,000 into the Trust Account (the “Second August 2024 Extension Payment”) resulting in BUJA having until September 30, 2024 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “Second August 2024 Extension Note”).
On September 24, 2024, the Sponsor deposited $100,000 into the Trust Account (the “September 2024 Extension Payment”) resulting in BUJA having until October 30, 2024 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “September 2024 Extension Note”).
On October 30, 2024, the Sponsor deposited $100,000 into the Trust Account (the “October 2024 Extension Payment”) resulting in BUJA having until November 30, 2024 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “October 2024 Extension Note”).
On November 29, 2024, the Sponsor deposited $100,000 into the Trust Account (the “November 2024 Extension Payment”) resulting in BUJA having until December 30, 2024 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “November 2024 Extension Note”).
On December 26, 2024, the Sponsor deposited $100,000 into the Trust Account (the “December 2024 Extension Payment”) resulting in BUJA having until January 30, 2025 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “December 2024 Extension Note”).
On January 24, 2025, the Sponsor deposited $100,000 into the Trust Account (the “January 2025 Extension Payment”) resulting in BUJA having until February 28, 2025 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “January 2025 Extension Note”).
On February 21, 2025, the Sponsor deposited $100,000 into the Trust Account (the “February 2025 Extension Payment”) resulting in BUJA having until March 30, 2025 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “February 2025 Extension Note”).
On March 26, 2025, the Sponsor deposited $100,000 into the Trust Account (the “March 2025 Extension Payment”) resulting in BUJA having until April 30, 2025 to complete its initial business combination. BUJA issued to the Sponsor an unsecured promissory note of $100,000 (the “March 2025 Extension Note,” together with the July 2024 Extension Note, the August 2024 Extension Note, the Second August 2024 Extension Note, the September 2024 Extension Note, the October 2024 Extension Note, November 2024 Extension Note, the December 2024 Extension Note, the January 2025 Extension Note, and the February 2025 Extension Note, the “Extension Notes”).
Pursuant to the Extension Notes, the Sponsor, has the right, but not the obligation, to convert the Notes, in whole or in part, respectively, into private units of the Company, each consisting of one ordinary share, par value $0.0001 per share, one-half of one warrant, and one right to receive one-tenth (1/10) of one ordinary share upon the consummation of a business combination, as described in the Prospectus, by providing the Company with written notice of the intention to convert at least two business days prior to the closing of the business combination. The number of units to be received by the Sponsor in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to the Sponsor by (y) $10.00.
Results of Operations and Known Trends or Future Events
We have neither engaged in any operations nor generated any revenues to date. Our activities for the year ended December 31, 2024 involved mainly searching for a suitable target for our initial business combination, There has been no significant change in our financial or trading position and no material adverse change has occurred since the date of our audited financial statements. After the IPO, we incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for expenses associated with the search for target opportunities.
For the year ended December 31, 2024, we had a net income of 1,201,415, which consisted of interest and dividend income of $2,388,838 on investments held in Trust Account, and which was offset by operating costs of $1,187,423.
For the year ended December 31, 2023, we had a net income of 1,058,806, which consisted of interest income of $3,737 on the operating bank account and interest and dividend income of $1,521,739 on investments held in Trust Account, and which was offset by operating cost of $466,670.
Liquidity and Capital Resources
For the year ended December 31, 2024, cash used in operating activities was $1,18,107. As of December 31, 2024, we had cash of $15,265 available for working capital needs. All remaining cash is held in the Trust Account and is generally unavailable for our use, prior to an initial business combination, and is restricted for use either in a business combination or to redeem the ordinary shares. As of December 31, 2024, none of the amount on deposit in the Trust Account was available to be withdrawn as described above.
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We intend to use substantially all of the net proceeds of the IPO, including the funds held in the Trust Account, to acquire a target business or businesses and to pay our expenses relating thereto, including deferred underwriting commissions of $1,150,000 payable to A.G.P. / Alliance Global Partners (“A.G.P.”), the representative of the underwriters of the IPO. To the extent that our share capital is used in whole or in part as consideration to effect our initial business combination, the remaining proceeds held in the Trust Account as well as any other net proceeds not expended will be used as working capital to finance the operations of the target business. Such working capital funds could be used in a variety of ways including continuing or expanding the target business’ operations, for strategic acquisitions and for marketing, research and development of existing or new products. Such funds could also be used to repay any operating expenses or finders’ fees which we had incurred prior to the completion of our initial business combination if the funds available to us outside of the Trust Account were insufficient to cover such expenses.
Over the next 12 months (assuming a business combination is not consummated prior thereto), we will be using the funds held outside of the Trust Account for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the business combination.
If our estimates of the costs of undertaking in-depth due diligence and negotiating our initial business combination is less than the actual amount necessary to do so, or the amount of interest available to us from the Trust Account is less than we expect as a result of the current interest rate environment, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to consummate our initial business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our initial business combination, in which case we may issue additional securities or incur debt in connection with such business combination. Subject to compliance with applicable securities laws, we would only consummate such financing simultaneously with the consummation of our initial business combination. Following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.
As of December 31, 2024, we had cash of $15,265 and a working capital deficit of $1,647,964. The Company has incurred and expects to continue to incur significant professional costs to remain as a publicly traded company and to incur significant transaction costs in pursuit of the consummation of a Business Combination. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that these conditions raise substantial doubt about the Company’s ability to continue as a going concern. In addition, if the Company is unable to complete a Business Combination within the Combination Period, the Company’s board of directors would proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company. There is no assurance that the Company’s plans to consummate a Business Combination will be successful within the Combination Period. As a result, management has determined that such additional conditions also raise substantial about the Company’s ability to continue as a going . The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of December 31, 2024. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual Obligations
As of December 31, 2024, we do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities.
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We are obligated to pay the underwriters a deferred underwriting fees equal to 2.0% of the gross proceeds of the IPO. Upon completion of the business combination, $1,150,000 will be paid to the underwriters from the funds held in the Trust Account.
The founder shares, the Ordinary Shares included in the Private Units, and any Ordinary Shares that may be issued upon conversion of working capital loans (and any underlying securities) will be entitled to registration rights pursuant to a registration rights agreement entered into in connection with the IPO. The holders of these securities are entitled to make up to two demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our completion of our initial business combination. We will bear the expenses incurred in connection with the filing of any such registration statements.
Critical Accounting Policies and Estimates
In preparing these financial statements in conformity with U.S. GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities, as well as the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation, or set of circumstances that existed as of the date of the financial statements, and that management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results may differ from these estimates. Management does not believe that we have any critical accounting estimates; however, we have identified the following critical accounting policy:
Net Income (Loss) Per Ordinary Share
The Company complies with accounting and disclosure requirements of FASB ASC 260, Earnings Per Share. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable shares and non-redeemable shares and the undistributed income (loss) is calculated using the total net loss less interest income and unrealized gain or loss on investments in trust account less any dividends paid. We then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable shares. Any remeasurement of the accretion to redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders.
Recent Accounting Pronouncements
In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” which expands annual and interim disclosure requirements for reportable segments. These requirements include: (i) disclosure of significant expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”); (ii) disclosure of an amount for other segment items (equal to the difference between segment revenue less segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss) by reportable segment and a description of their composition; (iii) annual disclosure of a reportable segment’s profit or loss and assets currently required by Topic 280 in interim periods; (iv) clarification that, if the CODM uses more than one measure of a segment's profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report those additional measures of segment profit or loss; (v) disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or in assessing segment performance and deciding how to allocate resources; and (vi) requiring a public entity that has a single reportable segment provide all the disclosures required by the amendments in this ASU, and all existing segment disclosures in Topic 280. ASU 2023-07 is for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025. The Company adopted ASU 2023-07 in the year ended December 31, 2024, and applied the amendments retrospectively to all prior periods presented in these consolidated financial statements.
Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.
