RE: Tingo/MICT Merger12 Oct 2022 18:12
LNew Merger Structure Facilitates Earlier Funding and Launch of Tingos
Export Business and Accelerates Development of Commodity Platform Business
Tingo, Inc. (Tingo) and MICT, Inc. (MICT) announced that they have
amended and restated their Agreement and Plan of Merger to accelerate the
acquisition by MICT of Tingos operating business (Tingo Mobile). The
transaction, which is being structured as a forward triangular merger of a
newly formed holding company of Tingo Mobile into a subsidiary of MICT
(Merger), provides for the issuance by MICT of a combination of common
stock and two series of convertible preferred stock to Tingo in exchange
for 100% beneficial ownership of Tingo Mobile and the assumption of certain
liabilities of Tingo. Tingo expects to receive shareholder approval of the
transaction and, following the mailing of an Information Statement to its
shareholders, expects to close the transaction with MICT in the fourth
quarter of 2022.
At the closing, MICT will issue Tingo shares of its common stock equal
to 19.9% of MICTs outstanding shares, as well as Series A and Series B
convertible preferred stock. Subsequent to the closing, MICT intends to
seek shareholder approval of the conversion of the Series A and Series B,
as well as Nasdaq approval of the conversion of the Series B preferred
stock, which at the time of the conversion would give Tingo, and ultimately
the Tingo shareholders, ownership of 75% of the outstanding shares of MICT
common stock. In 2023, the parties expect to file a registration statement
with the U.S. Securities and Exchange Commission (SEC) to enable Tingo to
distribute the shares of MICT to its shareholders.
In connection with the execution of the new Merger Agreement, MICT and
Tingo have entered into a loan agreement, under which MICT provides Tingo
with $20 million of funding for the primary purpose of accelerating the
launch of Tingo Mobiles export business and the development of its
commodity platform business.
The Merger of Tingo Mobile and MICT will create a highly profitable
Fintech and Agri-Fintech company, with annualized revenues expected to
exceed $1.0 billion. The merged group intends to capitalize on Tingo
Mobiles position as the leading Agri-Fintech platform in Nigeria, and to
accelerate Tingo Mobiles expansion plans to roll-out its services across
Africa. With MICTs strong and established footprint in Asia, Tingo Mobile
also intends to launch its Agri-Fintech platforms into China and South East
Asia, and certain other key markets in the world, as part of its
globalization plan.
L
In the first half of 2022, Tingo Mobile reported revenue of $525.7
million and gross profit of $317.4 million, which equated to substantial
growth as compared to the first half of 2021. Moreover, Tingo Mobiles
high-margin revenues from its proprietary Nwassa Agri-Fintech marketplace
platform increased almost four-fold to $252.4 million during the first half
of 2022, as com
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