Addentax Group Corp (NASDAQ:ATXG) saw its stock climb 38% in premarket trade Friday after the company disclosed plans to acquire the offshore wealth management and integrated cross-border service operations of Hong Kong-based Riches Group.
Company executives described the move as a strategic step to broaden Addentax’s global footprint by folding Riches Group’s offshore business ecosystem, AI-enabled financial solutions, and digital currency services into its own platform. Based on preliminary internal estimates provided by Addentax, the transaction could add about HKD 300 million in annualized revenue if completed.
Addentax would obtain access to Riches Group’s wealth management services, which the company says generate monthly transaction volumes in excess of HK$100 million. The scope of the proposed deal includes Riches Group’s cross-border lifestyle services and corporate fiduciary offerings, which have historically supported in excess of 1,000 high-net-worth families and more than 10,000 households worldwide.
Hong Zhida, chief executive officer of Addentax, commented on the proposal, saying, "We are excited about the opportunity to integrate Riches Group’s expertise and innovative capabilities into the Company’s global growth strategy. If completed, this proposed acquisition is expected to allow us to accelerate our expansion in the offshore financial market, leverage AI and digital currency, and create greater value for our stockholders, clients, and partners."
According to the company, the acquisition would provide Addentax with access to Riches Group’s AI-enabled wealth advisory capabilities as well as its experience in regulated digital asset-related services. Addentax indicated it plans to extend its offshore business footprint into high-growth markets including Southeast Asia, Europe, and North America following closing of the transaction.
In addition to product and market expansion, Addentax expects to integrate Riches Group’s professional team of more than 4,000 advisors. The company also highlighted the inclusion of Riches Group’s AI and digital currency research and development capabilities, which Addentax says would support ongoing technological development within its cross-border financial services operations.
Summary
Addentax announced a proposed acquisition of Riches Group’s offshore wealth and cross-border services business, citing the potential to add roughly HKD 300 million in annualized revenue, access monthly transaction volumes exceeding HK$100 million, and onboard a team of over 4,000 advisors. The company intends to leverage Riches Group’s AI-enabled advisory and regulated digital asset experience to expand in Southeast Asia, Europe, and North America.
Key points
- The proposed acquisition aims to accelerate Addentax’s global expansion and add AI-driven wealth management and digital currency services - impacts offshore financial services and fintech sectors.
- Preliminary estimates suggest the deal could contribute about HKD 300 million in annualized revenue, with access to monthly transaction volumes above HK$100 million - relevant to wealth management and cross-border payments markets.
- The transaction would bring a professional team of over 4,000 advisors and digital asset R&D capabilities into Addentax - relevant to talent and technology deployment in digital wealth services.
Risks and uncertainties
- The acquisition is proposed and not completed; the expected benefits are contingent on closing and subsequent integration - this uncertainty affects investors in Addentax and participants in offshore finance markets.
- Revenue projections are based on preliminary internal estimates, which may change as due diligence and integration proceed - this creates potential variability in financial outcomes for the company and the wealth management sector.
- Integrating a large advisor network and complex cross-border services presents execution and operational risks that could affect outcomes for clients and stakeholders across the offshore and fintech sectors.