#China #Hong Kong #Cango Inc. #Xiaojun Zhang #Jiayuan Lin

Cango Inc. Finalizes Strategic Agreement with Founders and EWCL

Cango Inc. (NYSE: CANG), a leading player in the Bitcoin mining industry, recently made headlines with its announcement of a definitive agreement with its co-founders, Xiaojun Zhang and Jiayuan Lin, and Enduring Wealth Capital Limited (EWCL). This significant deal, revealed on June 2, 2025, involves the sale of 10 million Class B ordinary shares for a total of $70 million. Notably, $15 million of this amount will be contingent upon the fulfillment of specific conditions.

This announcement comes shortly after Cango's strategic decision to divest all its business operations in the People's Republic of China (PRC), a move that was completed on May 27, 2025. With this agreement, Cango aims to finalize the upcoming transactions and transitions previously contemplated in a letter of intent from EWCL sent to the board on March 14, 2025.

Key Details of the Agreement

Under the terms of the agreement, the company is set to undertake several corporate actions connected to this share sale. The shares that EWCL will acquire are to remain classified as Class B ordinary shares, which carry voting privileges of 20 votes per share. To facilitate this structure, the founders have committed to converting their remaining Class B shares into Class A ordinary shares, which only hold one vote each. This move is intended to streamline the voting power within the company and enhance corporate governance.

In addition to the share conversion, the agreement includes potential restructuring of the board and management team of Cango, as directed by EWCL. This restructuring would take effect immediately after the transaction closes, reflecting a significant shift in leadership and strategy.

The shareholding structure post-transaction is expected to reveal that if the share-settlement transactions involving on-rack crypto mining machines do not go through, EWCL will possess approximately 4.81% of Cango's total outstanding shares and carry 50.28% of the voting rights. Conversely, the founders will retain 31.63% of the outstanding shares with 16.52% of the voting power. If the aforementioned transactions are completed, EWCL's ownership will drop to about 2.83% of the total shares, resulting in 36.81% voting rights.

Next Steps and Shareholder Involvement

For this agreement to become fully realized, Cango must secure shareholder approval for the necessary corporate actions within the upcoming extraordinary shareholders' meeting. While the company is preparing to hold this meeting soon, it is essential to note that various closing conditions must be met for the agreement to be finalized. These conditions include the approval of the shareholders and other requisite corporate actions.

Cango's Market Position and Future Outlook

Cango Inc. has positioned itself at the forefront of the Bitcoin mining sector with operations diversified across various regions, including North America, the Middle East, South America, and East Africa. The company entered the crypto asset arena in late 2024, driven by the rise of blockchain technology and a growing market for digital assets. In parallel, Cango continues to facilitate an online used car export service via AutoCango.com, catering to global consumers seeking high-quality vehicles from China.

The culmination of this agreement marks a significant development in Cango’s ongoing evolution as it navigates new market challenges and opportunities. Stakeholders are eager to see how these strategic changes will enhance the company's capabilities and market presence in the increasingly competitive crypto landscape. As Cango moves forward with these enhancements, regular updates from the company's management are expected to keep investors informed on performance metrics and strategic shifts.

For further insights and updates, visit Cango's official website. Keep an eye out for future developments as Cango Inc. embarks on this transformative journey.