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Guardforce AI Co., Limited, an AI and Robot-as-a-Service (RaaS) provider, announced it has signed a definitive agreement with Shenzhen Kewei Robot Technology Company Ltd to acquire certain parts of Kewei’s robot business-related assets in China.
This story updates our prior story earlier this year regarding the LOI between GFAI and Kewei.
As a result of the agreement, Kewei will transfer select equipment assets, client base in the sales pipeline and related sales channels and staff, as well as provide rights to the permanent use of its patents, thereby enhancing Guardforce AI’s new Robot-as-a-Service (RaaS) sales and capabilities.
The purchase price for these assets is expected to be approximately 2.1 million US dollars, which will be fully paid in the form of 10,500,000 restricted ordinary shares of the Company based on $0.20 per share. The Company expects to complete the acquisition in the first quarter of 2023, subject to customary closing conditions.
With this acquisition, Guardforce AI will have access to the entire China market through the sales channels and agents built by Kewei since 2019, and will serve clients across various industries, such as restaurants, hotels and office buildings, including Fortune 500 customers. The revenue streams will include robotic rental, advertising and technical services across most of the major metropolitan cities in China. The permanent usage of the existing robotic-related patents and software provides a solid foundation for future RaaS capability, and the parties anticipate a seamless transition for all existing clients. With the assets acquired through this acquisition, along with the robotic companies Guardforce AI acquired in March of 2022, the Company’s total robotic-related revenue across the entire China market is expected to reach approximately $12 million in 2023, with strong growth projected over the next three years.
Olivia Wang, Chairwoman and Chief Executive Officer of Guardforce AI, commented, “This acquisition is expected to be truly transformative, as it not only strengthens our foothold in major cities and regions across China, but also provides us new capabilities and a diverse customer base across a wide range of industries. Kewei has a strong track record of growth, and with the addition of the client base, sales channels and salesforce we are acquiring, we anticipate revenue growth in the robotic sector for the foreseeable future. We also look forward to leveraging these newly acquired capabilities across our global platform and expect to benefit from meaningful economies of scale. Importantly, completing the acquisition entirely with stock illustrates the support from Kewei shareholders and the team’s confidence and belief in our RaaS business. We look forward to the journey ahead.”
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