10-Q: Pelican Acquisition to Merge with Greenland Energy

Pelican Acquisition Corporation announced a definitive merger agreement with Greenland Exploration Limited and March GL Company, forming Greenland Energy Company, valued at $215 million.

Summary

• Pelican Acquisition Corporation entered into a definitive Merger Agreement on September 9, 2025, with Greenland Exploration Limited and March GL Company.
• The transaction will result in a combined entity, Pelican Holdco, Inc., being renamed Greenland Energy Company, which will be publicly traded on Nasdaq.
• The merger consideration is valued at US$215,000,000, based on a per share value of US$10.00.
• Existing Greenland shareholders will receive 1,500,000 shares of Holdco common stock, and March GL shareholders will receive 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 (excluding EBC) will forfeit 718,750 Founder Shares, and 431,250 Founder Shares will be transferred to FG Merchant Partners LP.
• Pelican Merger Sub issued a $100,000 unsecured, interest-free promissory note to Greenland on September 9, 2025, for merger-related transaction costs.
• For the three months ended July 31, 2025, the company reported a net income of $307,410, primarily driven by $635,672 in interest earned on investments held in the Trust Account.
• As of July 31, 2025, cash stood at $252,240, and investments held in the Trust Account totaled $86,885,672.
• The company has until August 27, 2026, to consummate its initial business combination.

Sentiment

Score: 7

Explanation: The announcement of a definitive merger agreement is a significant positive for a SPAC, as it fulfills its primary purpose. The valuation of $215 million and the formation of 'Greenland Energy Company' on Nasdaq provide a clear path forward. However, the 'going concern' warning, while common for SPACs, still introduces a degree of financial uncertainty regarding operational liquidity outside the trust, and the forfeiture/transfer of founder shares indicates some dilution for original sponsors. The overall sentiment is positive due to the successful identification and agreement for a business combination.

Positives

• Successfully secured a definitive merger agreement with Greenland Exploration Limited and March GL Company, valued at $215,000,000.
• Successfully completed its IPO and over-allotment option, raising $86,250,000 for the Trust Account.
• Reported a net income of $307,410 for the three months ended July 31, 2025, and $287,857 for the six months ended July 31, 2025, primarily from interest on trust account investments.
• Cash balance increased to $252,240 as of July 31, 2025, from $59,073 at January 31, 2025.
• The Sponsor and target company shareholders have entered into support agreements to vote in favor of the merger.

Negatives

• Management has determined that conditions raise substantial doubt about the Company's ability to continue as a going concern due to significant acquisition costs and insufficient financial resources to sustain operations for one year.
• The company has incurred significant general and administrative expenses, totaling $331,247 for the three months and $351,184 for the six months ended July 31, 2025.
• A portion of Founder Shares (718,750 shares) will be forfeited, and another portion (431,250 shares) will be transferred to a March GL shareholder, diluting the Sponsor's initial stake.
• The company is subject to various social and political risks, including tariffs, trade tensions, and global conflicts, which could adversely affect its ability to complete a business combination or the operations of the target business.

Risks

• The Company's ability to consummate a Business Combination may be materially and adversely affected by various social and political circumstances globally, including tariffs, rising trade tensions, and ongoing conflicts (Russia/Ukraine, Hamas/Israel).
• The ability to raise equity and debt financing for a Business Combination may be impacted by increased market volatility or decreased market liquidity.
• There is no assurance that the Company will be able to complete a Business Combination successfully within the Combination Period (by August 27, 2026).
• If a Business Combination is not completed within the Combination Period, the Company will be forced to liquidate, and public shareholders will receive a pro-rata portion of the Trust Account, while rights holders and Founder/Private Share holders (for those shares) will receive nothing.
• Management has determined that conditions raise substantial doubt about the Company's ability to continue as a going concern due to significant costs and lack of financial resources to sustain operations for a reasonable period.
• The Company is an early-stage and emerging growth company, subject to associated risks.
• The Company relies on the Sponsor to be liable for claims by vendors or prospective target businesses that reduce the Trust Account below $10.00 per Public Share, with certain exceptions.
• The exercise of rights is contingent upon future events, and holders might not receive the ordinary shares underlying the rights if a Business Combination is not consummated.

Future Outlook

The company intends to complete its initial business combination with Greenland Exploration Limited and March GL Company, forming Greenland Energy Company, which will be publicly traded on Nasdaq. The transaction is expected to close by June 30, 2026. The company expects to incur significant costs in pursuit of this combination and acknowledges substantial doubt about its ability to continue as a going concern if the combination is not successful within the prescribed timeline.

Management Comments

• We intend to primarily focus on target businesses within the technology industry globally.
• Our management has broad discretion with respect to the specific application of the net proceeds of the IPO and the sale of the Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination.
• There is no assurance that our plans to raise capital or to consummate a Business Combination will be successful within the Combination Period.
• Management has determined that such additional 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

This announcement is consistent with the ongoing trend of Special Purpose Acquisition Companies (SPACs) seeking to merge with private companies to bring them public. The target companies, Greenland Exploration Limited and March GL Company, are merging to form "Greenland Energy Company," suggesting a focus on the energy sector, potentially within the technology industry as initially stated by Pelican. This aligns with broader market interest in energy transition and technology-driven solutions within the energy sector.

Comparison to Industry Standards

• The merger consideration of $215,000,000 for Greenland Exploration Limited and March GL Company, forming Greenland Energy Company, can be compared to recent SPAC mergers in the energy or technology sectors. Similar-sized SPAC deals in the renewable energy or energy technology space have seen valuations ranging from $200 million to $500 million, depending on the maturity and revenue profile of the target.
• The forfeiture and transfer of Founder Shares are common mechanisms in SPAC mergers to align sponsor incentives with public shareholders and to incentivize target company shareholders.
• The "going concern" warning is a significant red flag, common for SPACs nearing their deadline without a definitive deal, but less common after a definitive agreement is announced, indicating potential liquidity challenges for the SPAC's operational expenses outside the trust.

Management Changes

Corporate Governance

Related Party Transactions

• Promissory Notes from Sponsor: The Sponsor loaned the Company an aggregate of $700,000 through unsecured, interest-free promissory notes, which were repaid upon the IPO closing on May 27, 2025.
• Administrative Services Agreement with Sponsor: The Company pays the Sponsor $20,000 per month (increased from $15,000 on April 4, 2025) for office space and administrative services.
• Legal Services from Celine & Partners PLLC: The Company engaged Celine & Partners PLLC, controlled by Mr. Hui Chen (husband of Ms. Chen Chen, who controls the Sponsor), for IPO representation ($350,000), additional legal services ($100,000), ongoing public reports ($20,000/month), and business combination legal services ($250,000 in milestone payments).
• Working Capital Loans: The Sponsor, officers, and directors, or their affiliates/designees, may loan the Company up to $1,500,000 for transaction costs, convertible into private units.
• Promissory Note to Greenland: Pelican Merger Sub issued a $100,000 unsecured, interest-free promissory note to Greenland on September 9, 2025, for merger-related transaction costs.

Stakeholder Impact

• Shareholders (Public): Will receive one share of Holdco common stock for each Pelican common stock, subject to redemptions. The merger provides a path to a publicly traded operating company, fulfilling the SPAC's purpose.
• Shareholders (Founder/Sponsor): Will forfeit 718,750 Founder Shares and transfer 431,250 Founder Shares to a March GL shareholder, reducing their initial stake but aligning incentives for the combined entity.
• Greenland & March GL Shareholders: Will receive Holdco common stock as merger consideration (1,500,000 shares for Greenland, 20,000,000 shares for March GL) and will be subject to lock-up agreements.
• EarlyBirdCapital, Inc. (EBC): Entitled to significant fees (underwriting, business combination marketing, right of first refusal for future financings) upon successful completion of the business combination.
• Creditors: The "going concern" warning indicates potential risk if the business combination fails, but the Trust Account protects public shareholders' redemption value.
• Management: Robert Price entered a non-competition agreement, indicating continued involvement or strategic importance.

Next Steps

• Pelican will effect a domestication to become a Texas corporation prior to closing.
• The transaction will involve a series of mergers where Pelican, Greenland, and March GL merge with subsidiaries of Holdco.
• Holdco will be renamed Greenland Energy Company and become publicly traded on Nasdaq.
• Shareholder approvals for the Business Combination will be sought.
• Greenland and March GL shareholders will enter into lock-up agreements at closing.
• The non-competition and non-solicitation agreement with Robert Price will become effective at closing.
• The closing of the Business Combination is expected to occur on or before June 30, 2026.

Key Dates

Recommendation

The announcement of a definitive merger agreement is a crucial step for a SPAC, providing a clear path to becoming an operating company. This significantly de-risks the investment compared to a SPAC still searching for a target. However, the "going concern" warning, while typical for SPACs operating on limited capital outside the trust, highlights ongoing operational liquidity challenges. The forfeiture and transfer of founder shares also represent a dilution for the original sponsor. Given the definitive agreement, the stock is likely to trade closer to its trust value with a premium reflecting the potential of the combined entity, but the operational uncertainties and the nature of SPACs suggest a "hold" until more details about the combined entity's financial projections and market reception are available. Investors should monitor the progress towards closing and the market's reaction to the new "Greenland Energy Company."

Keywords

SPAC, Merger Agreement, Greenland Energy Company, Pelican Acquisition Corporation, March GL Company, Greenland Exploration Limited, Technology Industry, Business Combination, IPO, Nasdaq, Blank Check Company, Trust Account, Financial Reporting, SEC Filing