Tavia Acquisition Corp.

Company Overview

Business Model: Tavia Acquisition Corp. is a blank check company incorporated in the Cayman Islands on March 7, 2024. Its sole purpose is to effect a business combination, such as a merger, share exchange, asset acquisition, share purchase, or reorganization, with one or more target businesses. The Company has not generated any operating revenues to date and does not expect to do so until the consummation of its initial business combination.

Market Position: The Company aims to be an attractive initial business combination partner by offering target businesses an alternative to the traditional initial public offering process, which it believes is more cost-effective and offers greater certainty of execution. It focuses on sectors pivotal to advancing sustainability and innovation, specifically new energy businesses, circular economy initiatives, and innovative agricultural and food technologies. The Company believes its management team's expertise in these sectors provides a significant competitive advantage in sourcing and evaluating potential targets.

Recent Strategic Developments:

• Initial Public Offering (IPO): On December 5, 2024, Tavia Acquisition Corp. consummated its IPO of 10,000,000 units at $10.00 per unit, generating gross proceeds of $100,000,000.
• Private Placement: Simultaneously with the IPO, 350,000 private placement units were sold to Tavia Sponsor PTE. LTD. and EarlyBirdCapital, Inc. at $10.00 per unit, generating gross proceeds of $3,500,000.
• Over-Allotment Option: On December 9, 2024, the underwriters exercised their over-allotment option in full, purchasing 1,500,000 additional units at $10.00 per unit, generating gross proceeds of $15,000,000.
• Additional Private Placement: Concurrently with the over-allotment closing on December 11, 2024, an additional 37,500 private placement units were sold to Tavia Sponsor PTE. LTD. and EarlyBirdCapital, Inc. at $10.00 per unit, generating gross proceeds of $375,000.
• Trust Account Funding: Following these transactions, an aggregate amount of $115,575,000 ($10.05 per unit) was placed in the Trust Account.
• Promissory Note: On February 2, 2026, the Company issued a non-interest bearing promissory note to EarlyBirdCapital, Inc. for up to $300,000, due upon the earlier of a business combination or liquidation.

Geographic Footprint: The Company's investment thesis prioritizes target businesses primarily in North America and Europe.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 100.0%
• Operating Margin: -25.3%
• Net Margin: 74.7%

Investment in Growth:

• R&D Expenditure: $0.0 billion
• Capital Expenditures: $0.0 billion
• Strategic Investments: $120.8 million held in the Trust Account as of December 31, 2025, for the purpose of effecting a business combination.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: None reported.
• Dividend Payments: Tavia Acquisition Corp. has not paid any cash dividends to date and does not intend to pay cash dividends prior to the completion of its initial business combination.
• Future Capital Return Commitments: Public shareholders are entitled to redeem their shares for a pro rata portion of the Trust Account upon completion of a business combination or if no business combination is completed within 18 months from the IPO closing (June 5, 2026).

Balance Sheet Position:

• Cash and Equivalents: $0.2 million (as of December 31, 2025)
• Total Debt: $0.5 million (Promissory note – related party, as of December 31, 2025)
• Net Cash Position: $(0.3) million (as of December 31, 2025)
• Debt Maturity Profile: A promissory note to Tavia Sponsor PTE. LTD. for up to $500,000 is non-interest bearing and due on the earlier of a business combination or liquidation. An EBC Promissory Note for up to $300,000 is non-interest bearing and due on the earlier of a business combination or liquidation.

Cash Flow Generation:

• Operating Cash Flow: $(0.7) million (for the year ended December 31, 2025)

Competitive Intelligence

Market Structure & Dynamics

The Company operates in a highly competitive market for business combination opportunities, facing competition from other blank check companies, private equity groups, leveraged buyout funds, and operating businesses seeking strategic acquisitions. Many of these competitors possess greater financial, technical, human, and other resources and extensive experience in identifying and effecting acquisitions. The market for attractive targets may be scarce, potentially increasing acquisition costs.

Competitive Positioning Matrix

Direct Competitors

Primary competitors include other special purpose acquisition companies, private equity funds, leveraged buyout funds, and operating businesses pursuing strategic acquisitions.

Competitive Response Strategy: Tavia Acquisition Corp. plans to leverage its management team's deep industry expertise, established deal sourcing network, and the advantages of being a publicly listed acquisition company to identify and secure high-quality acquisition opportunities. The strategy focuses on energy transition, circular economy, and food technologies, aiming to drive innovation and sustainability.

Risk Assessment Framework

Strategic & Market Risks

• Market Dynamics: The Company's search for a business combination is materially affected by global geopolitical conditions (e.g., Russia-Ukraine conflict, Israel-Hamas conflict), leading to market volatility, supply chain disruptions, and increased cyber-attacks. Macro-economic turbulence, including high unemployment, rising interest rates, and inflation, also poses risks.
• Technology Disruption: If a target business is in a technology-driven industry, there is a risk that it may fail to adapt to rapidly changing technology, evolving industry standards, and changing customer needs, which could negatively impact its competitiveness.

Financial & Regulatory Risks

• Market & Financial Risks:
  • Inability to Complete Business Combination: The Company must complete a business combination within 18 months from its IPO closing (by June 5, 2026), or it will liquidate, potentially returning only $10.05 per share (or less) to public shareholders, and rights will expire worthless.
  • Third-Party Claims: Proceeds in the Trust Account could be reduced by third-party claims, leading to a per-share redemption amount less than $10.05.
  • Financing Risk: The Company may need additional financing to complete a business combination, which may involve dilutive equity issuances or higher-than-desirable debt.
  • Dilution: Issuance of additional ordinary or preferred shares to complete a business combination or under an employee incentive plan could significantly dilute existing shareholders' equity interest.
  • Debt Incurrence: Incurring substantial debt for a business combination could adversely affect leverage and financial condition.
• Regulatory & Compliance Risks:
  • Changes in Laws/Regulations: The Company is subject to evolving SEC and other legal requirements, including the 2024 SPAC Rules, which may increase disclosure requirements, amend financial statement requirements, and increase potential liability, adversely affecting the business combination process.
  • Investment Company Act of 1940: There is a risk of being deemed an "investment company," which would impose burdensome compliance requirements or force liquidation. The Company mitigates this by investing Trust Account funds in U.S. government securities with short maturities or cash.
  • U.S. Federal Excise Tax: A 1% U.S. federal excise tax may be imposed on share repurchases (including certain redemptions) if the Company domesticates to a U.S. corporation or if the business combination involves a U.S. company.

Geopolitical & External Risks

• Geopolitical Exposure: Acquiring a non-U.S. target business exposes the Company to risks associated with the target's governing jurisdiction, including regulatory changes, tariffs, trade barriers, currency fluctuations, and challenges in managing cross-border operations.
• Trade Relations: Deterioration of relations between the United States and foreign governments could negatively impact potential target businesses or their goods and services.
• CFIUS Review: A business combination with a U.S. business in a regulated industry or affecting national security could be subject to review by the Committee on Foreign Investment in the United States (CFIUS), potentially blocking or delaying the transaction.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: The board of directors is divided into three staggered classes, with one class elected each year for a three-year term. An annual meeting of shareholders may not be held until after the consummation of the initial business combination, meaning current directors will continue in office until at least that time.

Board Composition: The board consists of five directors. The Audit Committee and Compensation Committee are comprised solely of independent directors: Christophe Charlier (Chairman of both, and an audit committee financial expert), Marsha Kutkevitch, and Darrell Mays. There is no standing nominating committee; director nominees are recommended by a majority of the independent directors.

Human Capital Strategy

Workforce Composition: Tavia Acquisition Corp. currently has two executive officers, Kanat Mynzhanov and Askar Mametov. The Company does not intend to have any full-time employees prior to the completion of its initial business combination.

Regulatory Environment & Compliance

Regulatory Framework: Tavia Acquisition Corp. is subject to laws and regulations enacted by national, regional, and local governments, particularly SEC requirements. As an "emerging growth company" under the JOBS Act, it benefits from certain exemptions from reporting requirements, including auditor attestation under Section 404 of the Sarbanes-Oxley Act. The Company has adopted a Clawback Policy on March 27, 2025, for incentive compensation.

Legal Proceedings: There is no material litigation, arbitration, or governmental proceeding currently pending against the Company or any members of its management team in their capacity as such.

Key Regulatory Changes:

• 2024 SPAC Rules: The SEC's final rules, effective 125 days after publication, impose additional disclosure requirements for SPAC IPOs and business combinations, amend financial statement requirements, and expand guidance on projections. These rules may increase potential liability and impact the Company's ability to complete a business combination.
• Investment Company Act of 1940: The Company manages its Trust Account investments (U.S. government securities with short maturities or cash) to avoid being deemed an "investment company" under the Investment Company Act, which would impose significant regulatory burdens or force liquidation.
• U.S. Federal Excise Tax: The Inflation Reduction Act of 2022 imposes a 1% excise tax on certain share repurchases by publicly traded domestic corporations. While the Company, as a Cayman Islands entity, is not expected to be directly subject to this, domestication to a U.S. corporation or a business combination with a U.S. company could trigger this tax on redemptions.
• CFIUS Review: Potential business combinations with U.S. businesses in regulated industries or those affecting national security may be subject to review by the Committee on Foreign Investment in the United States (CFIUS), which could delay or prohibit transactions.

Tax Strategy & Considerations

Tax Profile: Tavia Acquisition Corp. is an exempted Cayman Islands company and is not presently subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. Its tax provision was zero for the periods presented.

Geographic Tax Planning: In connection with a business combination, the Company may reincorporate in a different jurisdiction, potentially leading to significant income, withholding, and other tax obligations in multiple jurisdictions.

Insurance & Risk Transfer

Risk Management Framework: The Company expects to purchase a policy of directors' and officers' liability insurance. It has also entered into agreements with its directors and officers to provide contractual indemnification to the maximum extent permitted by law.

Risk Transfer Mechanisms: Tavia Sponsor PTE. LTD. has agreed to indemnify the Company for claims by third parties (with exceptions) that reduce the Trust Account below $10.05 per public share.