10-Q: Pelican Acquisition Q3 Net Income, Greenland Merger Update

Pelican Acquisition Corporation reported a net income of $514,636 for Q3 2025, while advancing its merger with Greenland Exploration Limited and March GL Company to form Greenland Energy Company.

Summary

• Reported a net income of $514,636 for the three months ended October 31, 2025, and $802,493 for the nine months ended October 31, 2025, primarily driven by interest income from investments held in the Trust Account.
• Entered into a definitive Agreement and Plan of Merger on September 9, 2025, with Pelican Holdco, Inc., Greenland Exploration Limited, and March GL Company.
• The transaction involves Pelican domesticating as a Texas corporation, followed by a series of mergers to form Greenland Energy Company, which will be publicly traded on Nasdaq.
• The merger consideration is US$215,000,000 in Holdco common stock, with existing Greenland shareholders receiving 1,500,000 shares and March GL shareholders receiving 20,000,000 shares.
• Pelican shareholders will receive one share of Holdco common stock for each Pelican common stock held, subject to redemptions.
• The Sponsor and other Founder Share holders will forfeit 718,750 Founder Shares and transfer 431,250 Founder Shares to FG Merchant Partners LP prior to closing.
• As of October 31, 2025, the company had a working capital deficit of $145,981 and a cash balance of $220.
• Management has raised substantial doubt about the company's ability to continue as a going concern without successfully completing the Business Combination by the August 27, 2026 deadline.

Sentiment

Score: 5

Explanation: The company has made significant progress by signing a definitive merger agreement, which is a crucial positive step for a SPAC. However, the explicit "going concern" warning due to the working capital deficit and reliance on the business combination for liquidity introduces considerable uncertainty and risk, balancing out the positive development.

Positives

• Reported a net income of $514,636 for the three months ended October 31, 2025, and $802,493 for the nine months ended October 31, 2025.
• Interest earned on investments held in the Trust Account was $888,798 for the three months and $1,524,470 for the nine months ended October 31, 2025.
• A definitive merger agreement was signed on September 9, 2025, with Greenland Exploration Limited and March GL Company, providing a clear path to a business combination.
• The underwriters fully exercised their over-allotment option on May 30, 2025, generating additional gross proceeds of $11,250,000 for the Trust Account.
• Investments held in the Trust Account totaled $87,774,470 as of October 31, 2025, providing a substantial base for the business combination.

Negatives

• The company reported a working capital deficit of $145,981 as of October 31, 2025.
• Cash on hand was only $220 as of October 31, 2025.
• Management has determined that conditions raise substantial doubt about the company's ability to continue as a going concern until the earlier of the consummation of the Business Combination or the date the company is required to liquidate.
• General and administrative expenses were significant, totaling $375,265 for the three months and $726,449 for the nine months ended October 31, 2025.

Risks

• There is no assurance that the proposed Business Combination will be completed successfully or on the terms contemplated by the Merger Agreement.
• The company must complete a Business Combination by August 27, 2026, or it will be forced to liquidate, which would result in public shareholders only receiving a pro rata portion of the Trust Account funds, and rights expiring worthless.
• The company's ability to consummate a transaction may be dependent on raising equity and debt financing, which could be impacted by increased market volatility or decreased market liquidity.
• Various social and political circumstances globally (e.g., U.S.-China trade tensions, Russia/Ukraine, Hamas/Israel conflicts) may contribute to increased market volatility and economic uncertainties, potentially affecting the Business Combination or the target business's operations.
• The Sponsor has agreed to be liable for claims by vendors or target businesses that reduce the Trust Account below $10.00 per Public Share, but there are exceptions to this liability.
• The company lacks the financial resources to sustain operations for a reasonable period (one year from financial statement issuance date) without completing a Business Combination, raising substantial doubt about its ability to continue as a going concern.

Future Outlook

The company intends to consummate a business combination with Greenland Exploration Limited and March GL Company to form Greenland Energy Company, which will be publicly traded on Nasdaq. This transaction is subject to customary closing conditions, including regulatory and shareholder approvals. The company has until August 27, 2026, to complete this or another business combination. Management acknowledges substantial doubt about the company's ability to continue as a going concern without completing the Business Combination.

Management Comments

• "We expect to continue to incur significant costs in the pursuit of our acquisition plans."
• "We cannot assure you that our plans to complete an initial business combination will be successful."
• "Management has determined that these conditions raise substantial doubt about the Company's ability to continue as a going concern until the earlier of the consummation of the Business Combination or the date the Company is required to liquidate."

Industry Context

Pelican Acquisition Corporation operates as a Special Purpose Acquisition Company (SPAC), a common vehicle for private companies to go public. The proposed merger with Greenland Exploration Limited and March GL Company, targeting the technology industry globally, aligns with the trend of SPACs seeking innovative or resource-focused companies. The transition to "Greenland Energy Company" suggests a focus on the energy sector, potentially leveraging technology for exploration or production, which is a significant area for investment and M&A activity. The inherent risks of SPACs, such as the deadline for a business combination and the "going concern" warning, are typical challenges in this industry.

Comparison to Industry Standards

• The SPAC structure, including the trust account and redemption rights, is standard for blank check companies in the industry.
• The requirement for the target business to have an aggregate fair market value of at least 80% of the assets held in the Trust Account is a common SPAC industry standard.
• The 15-month combination period (until August 27, 2026) is within typical SPAC timelines, though some SPACs may have longer or shorter periods depending on their initial offering terms.
• The "going concern" warning is a significant red flag, indicating a higher risk profile compared to established operating companies or even SPACs with stronger liquidity outside the trust account.
• The forfeiture and transfer of Founder Shares by the Sponsor to a target shareholder (FG Merchant Partners LP) is a mechanism sometimes used in SPAC mergers to align incentives and provide additional consideration to the target, similar to practices seen in other SPAC transactions.

Corporate Governance

Related Party Transactions

• The Sponsor was issued 2,875,000 ordinary shares for an aggregate consideration of $25,000.
• The Sponsor loaned the Company up to $200,000 and $500,000 via promissory notes, which were fully repaid upon the closing of the IPO.
• As of October 31, 2025, $10,000 was outstanding and due to a related party (the Sponsor) for transaction costs, unsecured and interest-free.
• The Company has an Administrative Services Agreement with the Sponsor, initially for $15,000 per month, increased to $20,000 per month from April 4, 2025, for office space and administrative services. $5,806 was unpaid as of October 31, 2025.
• Celine & Partners PLLC, controlled by Mr. Hui Chen (husband of Ms. Chen Chen who controls the Sponsor), was engaged for legal services related to the IPO ($350,000 fee, paid), additional legal services ($100,000 fee, paid), ongoing public reports ($10,000/month, increased to $20,000/month from January 10, 2025, with $20,000 unpaid as of October 31, 2025), and business combination legal services (structured fees, $150,000 incurred, $50,000 unpaid as of October 31, 2025).
• The Sponsor, the company's officers and directors, or their affiliates/designees may provide Working Capital Loans up to $1,500,000, convertible into private units, to finance transaction costs for an initial Business Combination. No borrowings were outstanding as of October 31, 2025.

Stakeholder Impact

• **Shareholders**: Public shareholders have redemption rights. Founder Shares will be forfeited and transferred, impacting the Sponsor's ownership. All shareholders will receive Holdco common stock upon domestication and merger. Lock-up agreements will restrict transfer for Greenland and March GL shareholders, potentially affecting liquidity for those parties.
• **Creditors**: The company's working capital deficit and the "going concern" warning could increase perceived credit risk, although the Trust Account funds are protected for public shareholders.
• **Management**: Management is actively pursuing the Business Combination, with significant efforts and costs incurred. The CEO and CFO are responsible for disclosure controls and procedures.

Next Steps

• Effect a domestication of Pelican from a Cayman Islands exempted company to a Texas corporation.
• Complete a series of mergers whereby Pelican, Greenland, and March GL will each merge with subsidiaries of Holdco.
• Holdco will be renamed Greenland Energy Company and become a publicly traded company on Nasdaq.
• File and ensure the effectiveness of a registration statement on Form S-4 containing a proxy statement/prospectus.
• Obtain necessary shareholder approvals for the Business Combination.
• Satisfy other regulatory requirements and customary closing conditions for the Business Combination.
• The Sponsor and other Founder Share holders will forfeit and transfer Founder Shares prior to the Closing.
• Greenland and March GL shareholders will enter into lock-up agreements at Closing.
• Pelican, Holdco, and Robert Price will enter into a non-competition and non-solicitation agreement, effective as of the Closing.
• The company must complete the Business Combination by August 27, 2026.

Key Dates

Recommendation

The definitive merger agreement is a critical positive development for a SPAC, providing a clear path to an operating business and reducing the risk of liquidation. However, the explicit "going concern" warning due to the company's working capital deficit outside the trust account introduces significant operational and financial risk until the merger successfully closes. Investors should hold their position to monitor the progress of the merger and the resolution of the going concern issue, as failure to close the transaction would lead to liquidation, while successful completion could unlock value. The current financial state outside the trust account prevents a "buy" recommendation, and the potential for redemptions adds uncertainty to the final capital structure.

Keywords

SPAC, Special Purpose Acquisition Company, Merger, Acquisition, Greenland Exploration Limited, March GL Company, Greenland Energy Company, Nasdaq, 10-Q, Quarterly Report, Technology Industry, Blank Check Company, IPO, Private Placement, Trust Account, Going Concern