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Alset Capital Acquisition Corp. (ACAX) to Combine with HWH International
by Nicholas Alan Clayton on 2022-09-12 at 2:00pm

Alset Capital (NASDAQ:ACAX) has entered into a definitive agreement to combine with lifestyle company HWH International.

Bethesda, Maryland-based HWH offers a range of perks via a membership program aimed at wellness, travel and VR experiences.

Transaction Overview

Alset Capital brings a pre-redemptions of trust of $86.3 million into the deal and has not yet supplemented this with a PIPE. The parties have released scant details on the deal thus far, but Alset’s profile page will be updated once additional details are available.

The SPAC is to acquire HWH for a total consideration of $125 million in ordinary Alset shares and Alset must maintain at least $30 million in cash available in order for the deal to close.

Both the company and sponsor have agreed to a one-year lock-up but may be released early should the company trade at or above $12 for 20 of 30 consecutive trading days.

Quick Takes: The gist of HWH’s business model appears to be in offering consumers discounts on products and services in exchange for an upfront membership fee through its travel and wellness subsidiaries.

These perks are all over the map. The company plans to open internet café/co-working locations in three locations – Singapore, Seoul, and West Lindon, Utah. These are meant to be hubs selling wellness and fitness products as well as travel packages, and members are to receive cards that give cash back benefits ranging from 5% to 15%, although it is unclear if these come on all purchases or just those at HWH’s locations.

At any rate, membership is not cheap. The lowest tier costs $58, with elite, platinum and black diamond packages costing $200, $850, and $1,200, respectively. The presentation does not make clear if this is a one-time fee or annual and its website lists no prices or means to sign up as of yet.

Members receive a package of milkshake mixes and other wellness and cosmetic products based on their tier and a wide mix of other stuff. The illustrative benefits linked to HWH’s Singapore location include free VR sessions for all tiers (although budget VR sets run cheaper than some of its membership tiers) and one free keto meal.

But, if you bump up to the $200 tier you get one free slice of the “cake of the day” on your birthday month and the $850-$1,200 tiers get a free coffee per day as long as $5 is spent with the member card and a free bottle of wine. The top two tiers also gain access to discounted travel and the company’s Wealthbuilder platform that will “empower the masses” and create “Millionaires” with advice on investing in ETFs, crypto, REITs, SPACs, mutual funds, “Hapi mining”, with opportunities for pre-IPO investing. Once again, all over the map.

Very little of this would make sense as a cohesive business model if it were not for the mention of referral benefits to members when they get others to join. Behind all of the other doodads, the higher membership tiers provide larger commissions on referrals and as such this is a multi-level marketing scheme like many others. Even so, it appears that even referral commissions come in the form of “points” that can likely only be redeemed within the HWH system.

The company also claims it is launching a gig economy app that purports to attract gig workers to brand promotional work, but about half of its listed customers are HWH affiliates and pricing is not listed.

The parties have not released any details as to current membership, but HWH’s presentation asserts that it could hypothetically turn $14.7 million in revenue for $3 million in profit with 10,000 members in the first year and expects it could expand this to 98,000 members in five years for $136 million in revenue and $48 million in profit.

The presented backstory to the business is no less bizarre. The company’s investor deck includes a slide boasting how HWH Chairman Chan Heng Fai raised an early investment fund with winnings from playing competitive poker and sold a Malaysian airline in 1972 for £500,000. The presentation also includes links to ebooks on Fai’s business advice in Chinese and Korean. What is perhaps more relevant is that Fai can also add SPAC experience to his resume as he is the Chairman and CEO of the Alset SPAC as well, steering both entities into this merger with one another.

The SPAC route was apparently not Fai’s first choice for getting this business off the ground, however. HWH filed an S-1 to list in a $5.7 million IPO to the pink sheets in 2016 and was briefly effective. In its last reported 10-Q, it generated $10,792 in revenue for a -$73,560 net loss in the nine months ending March 31, 2018.

Click here for the full investor presentation.


  • EF Hutton is serving as capital markets advisor to ACAX.
  • Sichenzia Ross Ference LLP is serving as legal advisor to ACAX.


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