ASPAC II Acquisition Corp.

ASPAC II Acquisition Corp. (ASPAC II) Annual Report: Key Insights for the Year Ended December 31, 2025

ASPAC II Acquisition Corp. (ASPAC II) has released its annual report for the year ended December 31, 2025. This summary cuts through the financial complexities, offering investors a clear and concise overview of the company's operations, financial standing, and the significant challenges it faces in its quest to find a merger target.

---

Business Overview

What is ASPAC II? A "Blank Check" Company on a Mission ASPAC II is a Special Purpose Acquisition Company (SPAC). It functions as a "blank check" company that raised capital from investors with the sole purpose of acquiring a private company and taking it public. The company is officially based in the British Virgin Islands, with its main operational office in Singapore.

Their Hunting Ground: High-Growth "New Economy" Sectors ASPAC II seeks to acquire a company in "New Economy Sectors." These include businesses leveraging cutting-edge technologies in areas like Proptech (property technology) and Fintech (financial technology). They also prioritize companies that adhere to Environmental, Social, and Governance (ESG) principles. While open to global opportunities, ASPAC II primarily focuses on North America, Europe, and Asia.

---

Financial Performance

From Launch to Limited Capital: The Financial Journey

• Initial Public Offering (IPO): ASPAC II launched on May 5, 2022, selling 20 million "Units" at $10 each, raising $200 million. Each Unit comprised one Class A ordinary share, one-half of a redeemable warrant (granting the holder the right to purchase additional shares later), and one-tenth of a "right" to receive an additional share upon a business combination. The sponsor also purchased additional warrants for approximately $9 million.
• Trust Account: ASPAC II placed $203.5 million, a significant portion of these proceeds, into a special Trust Account. This capital is reserved for funding an acquisition or for return to shareholders if no deal is completed.
• Financial Performance (Year Ended Dec 31, 2025): A SPAC's financial performance primarily reflects interest income earned from Trust Account assets and operating expenses incurred during the search for an acquisition target. Typically, SPACs report minimal revenue (primarily interest income) and a net loss due to administrative and professional fees.
• Limited Public Float: As of June 30, 2025, the total market value of shares held by non-affiliates was extremely low, at just $497,408. This indicates extremely limited public trading activity and potentially poor liquidity for investors.

---

Risk Factors

The China Connection: A Double-Edged Sword ASPAC II faces a crucial risk related to its China connections. Its main sponsor maintains strong ties to China, and all officers and directors reside there. While ASPAC II is not a Chinese operating company, these deep connections could significantly influence its ability to identify a suitable, non-China-based acquisition target.

Furthermore, China's government increasingly regulates Chinese companies listing overseas. Although ASPAC II believes these rules do not currently apply directly to it, a substantial risk exists that new or changed regulations could impact the company. This regulatory uncertainty could severely hinder ASPAC II's ability to complete a deal, potentially causing share value to drop significantly or even become worthless. This represents a major overhang for investors.

The Clock is Ticking, and Capital is Shrinking

SPACs operate under strict deadlines. ASPAC II has encountered significant challenges in identifying a target, resulting in multiple deadline extensions and substantial shareholder redemptions:

• August 2023 Extension: Shareholders approved an extension to August 5, 2024. However, shareholders redeemed a massive 18,003,605 Class A shares, choosing to take their money back rather than wait.
• July 2024 Extension: Shareholders granted another extension, pushing the deadline to August 5, 2025, which also saw further redemptions of 1,608,417 Class A shares.
• July 2025 Extension: A third extension secured a deadline of August 5, 2027, with 344,384 Class A shares redeemed during this period.

These redemptions have drastically reduced the capital available for an acquisition. While the initial Trust Account held $203.5 million, cumulative redemptions of approximately 19.96 million shares (18,003,605 + 1,608,417 + 344,384) mean a significant portion of the initial capital has been returned to investors.

As of February 17, 2026 (a subsequent event after the reporting period), approximately 5.24 million Class A shares remained outstanding, a sharp decline from the initial 20 million. This further underscores the reduced capital and investor confidence.

---

Management Discussion (MD&A Highlights)

Throughout the reporting period, management primarily focused on identifying a suitable business combination target within the specified "New Economy Sectors" and managing the company's operational timeline. Significant redemptions across multiple extension votes highlight the challenges in maintaining investor capital and confidence. Management actively sought and obtained shareholder approval for extensions to the business combination deadline, demonstrating commitment to completing a transaction despite the shrinking capital base. The ongoing search for a target, coupled with the need to navigate complex regulatory environments—particularly concerning the sponsor's China ties—represents the core operational challenge. The company's financial activities have largely involved managing Trust Account assets, incurring operating expenses, and processing shareholder redemptions.

---

Financial Health

ASPAC II's financial health primarily hinges on its Trust Account. This account holds the majority of the company's assets, invested in U.S. government securities or money market funds. Cash held outside the Trust Account is typically minimal, used to cover operating expenses. As a SPAC, ASPAC II typically carries no significant debt before a business combination.

• Cash and Trust Account: The initial Trust Account balance was $203.5 million. Following substantial redemptions, the remaining capital in the Trust Account is significantly lower and represents the primary asset available for a potential acquisition.
• Liquidity: Operational liquidity is limited to funds held outside the Trust Account, typically used for administrative and search-related expenses. The extremely low market value of non-affiliate shares ($497,408 as of June 30, 2025) suggests very poor public trading liquidity, making it difficult for investors to buy or sell shares without impacting the price.
• Debt: Debt is typically minimal for a SPAC prior to a business combination.

---

Future Outlook

ASPAC II continues its active search for a business combination, facing a final deadline of August 5, 2027. The company's strategy remains focused on identifying a target in "New Economy Sectors" that aligns with ESG principles, primarily across North America, Europe, and Asia. However, the path forward is fraught with significant challenges:

1. Severely Diminished Capital: Extensive redemptions mean ASPAC II has a much smaller capital pool. This significantly limits the size and type of acquisition it can pursue, making it harder to find a compelling target.
2. High China-Related Risk: Strong ties to China and the evolving regulatory landscape present unique and substantial risks that could derail any potential deal or impact the combined entity's value.
3. Deadline Pressure: While the August 2027 deadline provides some breathing room, intense pressure exists to find a suitable target that can gain shareholder approval with limited capital.
4. Uncertainty of Success: The success of this investment hinges entirely on ASPAC II's ability to identify and successfully complete a business combination, especially given its reduced funds and the specific geopolitical and regulatory risks. If ASPAC II fails to complete a deal by the deadline, the remaining funds in the Trust Account would be returned to shareholders, likely at or near the per-share redemption value, but without any potential upside from a successful merger.

---

Competitive Position

The SPAC market is highly competitive, with numerous blank check companies vying for attractive private targets. ASPAC II's competitive position typically depends on factors such as its management team's and sponsor's experience and network, the size of its Trust Account, and its specific target sector focus.

• Competitive Advantages: Competitive advantages typically include the management team's expertise in their target sectors and their network for sourcing deals.
• Competitive Landscape: The significant number of SPACs, particularly those targeting "New Economy" sectors, creates a challenging environment for identifying and securing high-quality acquisition targets. ASPAC II's reduced capital due to redemptions further impacts its competitive standing against larger SPACs.

---

What This Means for Investors

In essence, ASPAC II remains in a high-stakes "hunting" phase, but with significantly less capital and a complex regulatory environment to navigate. Investors should carefully weigh these substantial risks.