Highway Holdings takes $7M from David Lazar, who becomes CEO in near-total takeover
What's the deal? Highway HoldingsDealroom has a profile for this one. Try Dealroom → (Nasdaq: HIHO) has closed a $7 million strategic investment from David LazarDealroom has a profile for this one. Try Dealroom →, who takes a stake that could reach roughly 95% of the company on a fully diluted basis. The Hong Kong-based manufacturer sold Lazar $3.5 million each of Series AA and Series AAA convertible preferred shares, closing in a single round on November 4, 2026.
Why now? The deal follows the company's worst year on record: fiscal 2026 sales fell to $4.8 million from $7.4 million, which it blamed on reduced customer orders. Highway Holdings framed the transaction as the result of a review of options to maximize value for stakeholders.
What's the endgame? Alongside the investment, the company plans to spin off its legacy manufacturing business into a new British Virgin Islands subsidiary, distributing those shares pro rata to existing shareholders. Legacy holders will also receive a $2 million cash dividend. The spin-off is targeted within 365 days of closing.
The key hire: Lazar was appointed chief executive officer following the closing and joined the board with one nominee; he can recommend up to five more directors at a special meeting. The structure effectively hands control of the remaining public shell to Lazar, who has led similar investor-driven restructurings at AterianDealroom has a profile for this one. Try Dealroom → and other public companies.
What could go wrong? Much of the plan hinges on shareholder approval. A special meeting is needed to convert the preferred shares and to approve director elections, an increase in authorized shares, and a reverse share split. The spin-off, dividend, and related payments will be overseen by a special committee of independent directors.
The signal: This is less a growth round than a reset. By separating a shrinking manufacturing operation and recapitalizing the remaining entity, the deal reflects a familiar pattern of investor-led takeovers of struggling small-cap public companies—where the cleaner listed vehicle, not the legacy business, is the prize.
Read more: pr.sandyjournal.com
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