- Flamingo Ai (FGO) has entered into an agreement to sell all of its assets to Rymamy Investments
- The company had been trying to reduce its cash burn rate in recent months and raise capital to try and keep afloat, but ultimately fell short
- Founder of Flamingo Ai and current Head of Business Development, Dr Catriona Wallace, has been given notice regarding the cessation of her employment — however — she will remain on the company’s board
- The company has proposed current CEO, Olivier Cauderlier, continue his employment with the purchaser
- The transaction is still subject to a number of conditions and needs shareholder approval, although Flamingo Ai has commenced a process to look for additional assets to acquire
- The company came out of a voluntary suspension on the ASX today, and its shares are trading for 0.2 cents each
Information Technology company Flamingo Ai (FGO) has entered into an agreement to sell all of its assets to Rymamy Investments.
Flamingo Ai couldn’t stop the rate it was burning cash over recent months and had been trying to raise capital in a volatile market to keep it afloat.
The company said it became evident that the prospects of raising substantial capital were unlikely, and it engaged a private investment fund to seek potential buyers for the Flamingo Ai business.
It landed with Rymamy, which is a nominee for the Craig Neil Investment Trust, who is now working through the conditions of the sale agreement.
The transaction
Flamingo Ai and the purchaser are working through the conditions of the sale to generate a definitive formal agreement necessary to fully document the terms of the deal.
The nominee will acquire the business of Flamingo Ai by assuming all the assets comprising the business from the company. The assets include the assignment or transfer of all current and prospective customer agreements, all intellectual property, customer contracts and IT equipment.
The purchaser will pay just $100 after Flamingo Ai obtains shareholder approval for the transactions contemplated by the terms sheet.
The conditions of the deal include the purchaser completing due diligence investigations by June 1 and both parties entering a formal agreement by June 9. Flamingo Ai also needs to obtain all necessary approvals and third party consent, as well as shareholder approval and the purchaser, needs to offer key employees new positions with agreements by June 1.
Flamingo Ai has proposed current CEO, Olivier Cauderlier, continue his employment with the purchaser, while company Founder and current Head of Business Development, Dr Catriona Wallace, has been given notice regarding the cessation of her employment — however — she will remain on the company’s board. Bryn Hardcastle and Zane Lewis will also remain on the board.
The company estimates it will have around $1.4 million in cash at the completion of the transaction.
The company came out of a voluntary suspension on the ASX today, and its shares are trading for 0.2 cents each.