Logiq Inc. (NEO:LGIQ.AQN, OTCQX:LGIQ) has highlighted its progress with a number of major corporate initiatives in a shareholder update.
“We have been preparing to report our 2022 results along with a detailed corporate update,” said Logiq CEO, Brent Suen in the update. “However, given the disclosure of a number of positive events over the past week, including the Form 4 filing of my large purchase of shares, we would like to take this opportunity to address some of the investor questions we’ve been receiving lately."
"In all, the recent events have been very positive and our goals are well on track," Suen added.
READ: Logiq expects DataLogiq business revenues for fourth quarter ending December 31, 2022, to exceed $7.5M
The company's update spotlighted the following:
Ionic Share Purchase Agreement: Logiq received a $3 million investment from Ionic Venture under a $40 million share purchase agreement initiated in March 2022. On March 16, 2023, both the Ionic share purchase agreement and the associated S-1 registration were mutually terminated. Given the company’s progress over the last several months and the positive outlook ahead, Logiq management believes it was in the best interest of shareholders to eliminate the funding program. Of the remaining shares held by Ionic, 2,255,000 shares were purchased by Logiq CEO, Brent Suen, with the balance purchased by a group of private investors.
Q4 Financials: The company reiterates that it expects to report revenues of approximately $7.5 million for the fourth quarter ended December 31, 2022, increasing more than 83% sequentially and up more than 9% over the same year-ago quarter. A major new consumer product client, which was onboarded in November 2022, is transitioning to Logiq’s programmatic advertising platform which would generate high-margin revenues. The company continues to estimate that Logiq’s annualized revenue run rate now totals about $40 million.
DataLogiq subsidiary SPAC Merger: The company believes it is making good progress toward the completion of the SPAC merger and remains confident in completing a successful transaction. Logiq and the SPAC are processing the second round of comments they have received from the Securities and Exchange Commission (SEC) regarding the merger and Form S-4 filing. The company is also in the process of completing the audit of DataLogiq’s 2022 financial results on a stand-alone basis. The audited results will be added to the Form S-4 and submitted to the SEC along with the company’s response to the comments.
Post-DataLogiq SPAC Plans: The company believes the current struggling IPO market increases the attractiveness and value of public reporting companies like Logiq for potential M&A candidates looking to gain access to the capital markets. The previously announced merger exclusivity offered to the PrivCo announced in November expired on December 31, allowing Logiq to pursue negotiations with other potentially more favorable private companies looking to go public. The ideal target would enable Logiq to qualify for a listing on a senior stock exchange.
Strategic M&A: Over the last several years, Logiq has pursued an aggressive strategic M&A program, with two acquisitions under DataLogiq which were accretive and have continued to scale. Battlebridge, for example, secured a major customer win late in 2022 that is contributing significantly to revenues, with this driving a substantial margin expansion. The current industry environment continues to present accretive M&A opportunities that could contribute to significant revenue growth if completed. Given the ‘target-rich’ landscape, the company is evaluating several potential acquisitions that could create an exciting platform for customers, strategic partners and investors.
Logiq CEO Suen concluded: “We are in active discussions with targets engaged in Adtech, direct-to-consumer sales, specialized digital advertising, and performance marketing. All are generating revenue growth and are break even to profitable. If such a transaction would be completed, we would expect the combined scale to propel our growth exponentially in 2023.”
Logiq is a US-based provider of eCommerce and digital customer acquisition solutions by simplifying digital advertising. It provides data-driven, end-to-end marketing through its results solution or providing software to access data by activating campaigns across multiple channels.
The company’s Digital Marketing business includes a holistic, self-serve ad tech platform. Its proprietary data-driven, AI-powered solutions allows brands and agencies to advertise across thousands of the world’s leading digital and connected TV publishers.
Contact the author at jon.hopkins@proactiveinvestors.com