SHANGHAI, Feb. 5, 2019 /PRNewswire/ -- CLPS Incorporation (the "Company" or "CLPS") (Nasdaq: CLPS), a leading information technology ("IT") consulting and solutions service provider focusing on the banking, insurance and financial sectors in China and globally, today announced that it has increased its ownership stake in Lihong Financial Information Services Co., Ltd. ("Lihong"), an online lending platform company in China.
CLPS made its first strategic investment in Lihong six months ago. Now the parties have agreed to increase the Company's ownership stake from 2.7% to 36.8%.
In recent years, the rapid growth of the consumer lending business has fueled China's consumer spending. According to China's most recent annual consumer loan index, Lihong has been one of the major players in the industry with approximately RMB 5 million in average daily loan volume and growing. With CLPS's keen understanding of the business potential of consumer lending and Lihong's business development capability, both parties believe that the increased investment will result in a mutually beneficial ongoing business relationship.
Founded in 2015 and headquartered in Shanghai, Lihong's online lending platform uses big data technology to enable individual, small- and mid-sized Chinese banks to provide consumer loans with insurance policies acting as debt collateral. Lihong receives a per-transaction fee, which is generally contingent upon the size of the loan transaction, as well a fixed maintenance fee.
In line with the CLPS's development goals, the increased investment will further diversify its revenue model into new business services, is anticipated to add to the Company's ability to generate additional operating income, and to further support the Company's "dual engine" strategy.
About CLPS Incorporation
Headquartered in Shanghai, China, CLPS Incorporation (the "Company") (Nasdaq: CLPS) is a global leading information technology ("IT"), consulting and solutions service provider focusing on the banking, insurance and financial sectors. The Company serves as an IT solutions provider to a growing network of clients in the global financial industry, including large financial institutions in the US, Europe, Australia and Hong Kong and their PRC-based IT centers. The Company maintains ten delivery and/or research & development centers to serve different customers in various geographic locations. Mainland China centers are located in Shanghai, Beijing, Dalian, Tianjin, Chengdu, Guangzhou and Shenzhen. The remaining three global centers are located in Hong Kong, Singapore and Australia. For further information regarding the Company, please visit: http://ir.clpsglobal.com/.
Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, including, among others, the Company's ability to complete this investment successfully and timely, its ability to generate additional operating income and to diversify its development goals which may be beyond the Company's control, and which may cause the actual results, performance, capital, ownership or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in the Company's most recently filed annual report on Form 20-F and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.
Tian van Acken
Chief Financial Officer