Hudson Capital Inc. (NASDAQ:HUSN) has entered into an agreement to merge with FreightHub Inc. (Fr8Hub), a North American transportation logistics platform company focused on United States-Mexico cross-border shipping.
Existing Fr8Hub shareholders intend to invest $12 million in connection with the transaction, which is expected to close in 2021.
“With its differentiated technology platform, first mover advantage and extensive management experience and expertise, Fr8Hub is well positioned to capitalize on the expanding truckload freight industry cross-border between the United States and Mexico,” Hon Man Yun, chief financial officer of Hudson Capital, said in a release.
Shareholders from both companies have yet to approve the deal. Once the required approvals are obtained, the transaction will result in Fr8Hub becoming a wholly owned subsidiary of Hudson Capital.
Immediately following the closing of the merger, the former Fr8Hub shareholders will hold approximately 85.7% of the combined company and the shareholders of Hudson Capital will retain ownership of approximately 14.3% of the combined company, on a fully diluted basis. Additionally, Fr8Hub will make a cash payment of $1.75 million to Hudson at closing.
Fr8Hub was founded in July 2017 as a digital freight marketplace, broker and provider of transportation management systems focused on truckload freight. The company has offices in New York, Chicago, Mexico City and Monterrey, Mexico.
Fr8Hub’s cloud-based digital freight marketplace is designed to match cross-border shippers throughout Mexico and the domestic U.S. (to and from border cities) with available carriers and drivers for their loads.
Beijing-based Hudson Capital was founded in 2014. The company provides financial advisory services to small and midsize companies, including commercial payment, intermediary bank loan and international corporate financing advisement.
According to Yun, Fr8Hub began selling its Fr8Hub 2.0 in earnest in June and has seen “extraordinary month-over-month revenue growth.”
Fr8Hub’s monthly revenue grew from $247,000 in May to more than $1 million in September, according to the release.
Fr8Hub President Mike Flinker said being a publicly traded company will enable it “to build a market-leading position serving the $40 billion trucking industry in Mexico.”
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