Tingo, Inc. (OTC Markets: TMNA) (“Tingo”) and MICT, Inc. (NASDAQ:
MICT) (“MICT”) announced that they have amended and restated their
Agreement and Plan of Merger to accelerate the acquisition by MICT
of Tingo’s 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 MICT’s 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
Mobile’s 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 Mobile’s position as the
leading Agri-Fintech platform in Nigeria, and to accelerate Tingo
Mobile’s expansion plans to roll-out its services across Africa.
With MICT’s 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.
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 Mobile’s 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 compared to $66.7 million in the first half of 2021.
Once consummated, the Merger will represent a
substantial move by both Tingo Mobile and MICT to globalize their
operating businesses and synergistically leverage their proprietary
technologies to create best-in-class financial platforms, products
and services. The combined technology stack of both Tingo Mobile
and MICT is expected to create one of the world’s leading fully
integrated Fintech and Agri-Fintech ecosystems, offering a range of
innovative and complimentary products to an already significant and
fast-growing user based, with such products including financial
services, insurance services, payment services, e-wallet, commodity
trading and a comprehensive marketplace.
Dozy Mmobuosi, who will remain as Chief
Executive Officer of Tingo Mobile, commented: “The restructuring of
our merger with MICT will enable us to expedite the execution of
our ambitious expansion strategy, enter new markets and continue to
develop products and solutions specifically catered to our
customers’ needs. This internationalization will enable us to
rapidly dollarize Tingo Mobile’s Agri-Fintech platform, Nwassa, and
TingoPay, and accelerate the development of a broad range of world
class global Fintech and Agri-Fintech products and business
verticals. This new chapter for Tingo Mobile, as a Nasdaq listed
company will increase the profile of our incredible business, and
of its visibility to the broader business and investment
communities, whilst also providing access to capital through the
debt and equity markets to facilitate the acceleration of our
expansion plans. The Merger represents a tremendous opportunity for
both Tingo Mobile and MICT to significantly grow our operating
businesses and service offerings in new markets, as well as seek
value-enhancing strategic acquisitions.”
About Tingo
Tingo is the leading Agri-Fintech company
operating in Africa, with a marketplace platform that empowers
social upliftment through mobile, technology and financial access
for rural farming communities. Tingo’s novel “device as a service”
model allows it to add market leading applications to enable
customers to trade, buy top ups, pay bills, access insurance and
lending services. With 9.3 million existing customers, Tingo
is seeking to expand its operations across select markets in
Africa. Tingo’s strategic plan is to become the eminent
Pan-African Agri-Fintech business delivering social upliftment and
financial inclusion to millions of SME farmers and women-led
businesses.
Tingo, including its subsidiary Tingo Mobile,
offers its comprehensive platform service through use of
smartphones – ‘device as a service’ (using GSM technology) -- to
empower a marketplace to enable subscribers/farmers within and
outside of the agricultural sector to manage their commercial
activities of growing and selling their production to market
participants both domestically and internationally. The ecosystem
provides a ‘one stop shop’ solution to enable such subscribers to
manage everything from airtime top ups, bill pay services for
utilities and other service providers, access to insurance services
and micro finance to support their value chain from ‘seed to
sale’.
As of June 30, 2022, Tingo had approximately 9.3
million subscribers using its mobile phones and Nwassa platform.
Nwassa is Africa’s leading digital agriculture ecosystem that
empowers rural farmers and agri-businesses by using proprietary
technology to enable access to markets in which they operate. Farm
produce can be shipped from farms across Africa to any part of the
world, in both retail and wholesale quantities. Nwassa’s payment
gateway also has an escrow structure that creates trust between
buyers and sellers. Tingo’s system provides real-time pricing,
straight from the farms, eliminating middlemen. Tingo’s users pay
for produce bought using available pricing on its platform. The
platform has created an escrow solution that secures the buyer,
funds are not released to Tingo members until fulfilment. The
platform also facilitates trade financing, ensuring that banks and
other lenders compete to provide credit to its members.
Although Tingo has a large retail subscriber
base, it is essentially a business-to-business-to-consumer
("B2B2C”) business model. Each subscriber is a member of one of two
large farmers’ cooperatives with whom Tingo has a contractual
relationship and which relationship facilitates the distribution of
Tingo branded smartphones into various rural communities of member
farmers. Tingo’s smartphones and its proprietary applications allow
Tingo to distribute its wider array of Agri-Fintech services and
generate the diverse revenue streams.
About MICT
MICT is a financial technology business
principally focused on the growth and development of a suite of
consumer fintech services across approximately 130 cities in China,
with planned expansion into additional markets. MICT has developed
highly scalable proprietary platforms for insurance products (B2B,
B2B2C and B2C) and financial services/products (B2C), the
technology for which is highly adaptable for other applications and
markets. MICT has acquired and holds the requisite license and
approvals with the Hong Kong Securities and Futures Commission to
deal in securities and provide securities advisory and asset
management services. MICT also has memberships/registrations with
the Hong Kong Stock Exchange, the London Stock Exchange and the
requisite Hong Kong and China Direct clearing companies. MICT’s
financial services business and first financial services product,
the Magpie Invest app, is able to trade securities on NASDAQ, NYSE,
TMX, HKSE, China Stock Connect, LSE, the Frankfurt Stock Exchange
and the Paris Stock Exchange.
Cautionary Note Regarding
and Forward-Looking Statements
This press release and statements of each of
Tingo and MICT’s management made in connection therewith contain
“forward-looking statements” (as defined in Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended). The words “believe,”
“may” “will,” “estimate,” “continue,” “anticipate,” “intend,”
“expect” and similar expressions are intended to identify
forward-looking statements. These forward-looking statements are
based upon Tingo’s and MICT’s respective current expectations and
assumptions and are subject to significant risks and uncertainties
that could cause actual results (including whether the Merger will
actually be consummated and the anticipated benefits of the Merger
to the businesses of each of Tingo and MICT as described herein) to
differ materially from those contemplated in such forward-looking
statements. Factors that could cause actual results to differ
materially include, but are not limited to, the risk factors
described in each of Tingo’s and MICT’s filings with the Securities
and Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
to the date hereof. Neither Tingo nor MICT undertakes any
obligation to release publicly any revisions to these
forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events, except as required by law. The inclusion of
any statement in this release does not constitute an admission by
Tingo, MICT or any other person that the events or circumstances
described in such statements will take place as described or are
material.
ADDITIONAL INFORMATION
Participants in the Solicitation
MICT and Tingo and certain of their respective
directors, executive officers, other members of management and
employees, under SEC rules, may be deemed to be participants in the
solicitation of proxies from the shareholders of MICT in favor of
the approval of the Merger. Additionally, MICT has engaged Morrow
Sodali LLC to assist in the solicitation of proxies in connection
with its special meeting.
Additional information regarding the interests
of such potential participants will also be included in the
Registration Statement and other relevant documents when they are
filed with the SEC. Free copies of these documents may be obtained
as described in the preceding paragraph.
No Offer or Solicitation
This Press Release does not constitute a
solicitation of a proxy, consent or authorization with respect to
any securities or in respect of the Merger. This Press Release
shall also not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor shall there be any sale of
securities in any states or jurisdictions in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended, or an exemption therefrom.
Tingo Contact
InformationRory BowenChief of Staff – Tingo,
Inc.Rory.bowen@tingoinc.com
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