Guardforce AI Co Ltd (NASDAQ:GFAI) said it has signed a non-binding letter of intent (LOI) with Shenzhen Intelligent Guardforce Robot Co Ltd to acquire Shenzhen Kewei Robot Technology Company Ltd, a high-tech robotics company specializing in developing robotics software solutions and robotics management platforms, as well as robotics sales and technical services.
The agreement supersedes and replaces the previously-announced LOI with Kewei to acquire 12 of its subsidiary companies, and the terminated securities purchase agreement under which the company had intended to acquire seven of its subsidiary companies.
"After conducting further due diligence, it became clear that acquiring Kewei itself, compared to acquiring only the Kewei sales channel subsidiaries, would add both a premier roster of business clients, as well as advanced technologies that we believe will help to accelerate our strategic expansion within the robotics industry worldwide,” Guardforce AI chairwoman and chief executive officer Olivia Wang said in a statement.
“Overall, we remain focused on our goal to transform Guardforce AI into a leading integrated security company in AI and robotics," she added.
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Guardforce AI said the purchase price and closing of the acquisition are subject to the satisfactory completion of the company's due diligence and independent audit, as well as a third-party valuation and fairness opinion.
The company plans to pay for the acquisition through a combination of cash (10%) and restricted common shares (90%) at a value of no less than $1 per share, and expects to enter into a definitive purchase agreement with the Shenzhen-based company within the next few months.
"We are thrilled to announce this proposed acquisition of Kewei, a qualified National High-tech Enterprise in China, which holds more than a dozen robotics-related patents and more than 40 copyrights to its proprietary software,” Guardforce AI president Lin Jia said.
“Its robotic solutions cover a variety of recurring revenue streams such as technical services and robotics advertising. The RaaS platform currently operates approximately 65,000 robots that belong to Kewei, clients, and partners, of which more than 40,000 are equipped with screens for advertising and interactive features,” he added.
Kewei's customer base includes an impressive roster of Fortune 500 corporations across various industries, Lin noted. In 2021, the company’s unaudited Chinese GAAP revenue was approximately $15 million.
“Overall, we believe this proposed acquisition, including Kewei's highly-skilled R&D team, robust robotics platform, operational skills, as well as its advertising and technical capabilities, provide us a solid foundation to further expand our geographic footprint across China and other international markets," he concluded.
Guardforce AI is a global integrated security solutions provider focused on developing robotic solutions and information security services that complement its well-established secured logistics business. With more than 40 years of professional experience, Guardforce AI is a trusted brand name that protects and transports high-value assets belonging to public and private sector organizations. Guardforce AI develops and provides innovative technologies and services that enhance safety and protection.
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