Genius Group Release Additional Details of FatBrain AI Transaction
March 18 2024 - 6:00AM
Genius Group Limited (NYSE American: GNS) (“Genius Group” or
the “Company”), a leading entrepreneur edtech and education group,
released today additional details on their recently announced
transaction to form an AI-powered Education and Acceleration group
to power Sovereign AI ecosystems of tomorrow for entrepreneurs,
enterprises, governments and students through AI education and
enablement:
- Deal Structure:
The transaction was the purchase of selected FatBrain AI assets and
liabilities by Genius Group in an all-share transaction, through
the purchase of the stock of a FatBrain subsidiary which is held by
Genius as a wholly owned subsidiary, and no merger into Genius has
taken place.
- Post-Transaction Revenue,
Profit: Following the transaction, Genius Group’s 2023 pro
forma revenue is expected to grow approximately 150%, with 2023 pro
forma revenue guidance growing to an estimated $76 million to $80
million. Genius Group’s 2023 pro forma net profit is expected to
grow approximately 150%, with 2023 pro forma net profit guidance
growing to an estimated $7 million to $9 million (all financials
currently in the Company’s 2023 audit process).
- Post-Transaction Balance
Sheet: Following the transaction, Genius Group’s 2023 pro
forma total assets is expected to grow approximately 40%, with 2023
pro forma total assets guidance growing to an estimated $110
million to $115 million. Genius Group’s 2023 pro forma net profit
is expected to grow approximately 50%, with 2023 pro forma total
liabilities guidance growing to an estimated $60 million to $65
million (all financials currently in the Company’s 2023 audit
process)
- Post-Transaction
Structure: The Post-structure leaves Genius Group Ltd as
the parent company with the FatBrain assets existing in a wholly
owned subsidiary of the parent company, which will continue to
trade on NYSE American under the ticker NYSEAmerican:GNS as a
Singapore-based company with its consolidated financials compliant
with IFRS Standards.
- Post-Transaction
Leadership: Genius Group has an exeuctive executive team
and Board of Directors as follows. Peter Ritz, FatBrain’s AI’s CEO,
will join the Genius Group Board as Executive Director and Michael
Moe, FatBrain AI’s Chairman, will join the Genius Group Board as
Non-Executive Chairman. The Current Genius Group of Roger James
Hamilton (CEO), Suraj Naik (Executive Director) and Richard Berman,
Eric Pulier and Salim Ismail (Non-Executive Directors) remain on
the Board. The split of the Board is: 2 members (29%) FatBrain AI
representation. 5 members (71%) Genius Group representation.
- Post-Transaction
Ownership: All of FatBrain AI’s former shareholders, which
includes investors in the US and accomplished technology and
education entrepreneurs and investors, including Michael Moe and
Peter Ritz, will receive one (1) Genius Group share for every three
(3) FatBrain AI shares. The ownership split immediately subsequent
will be approximately 57% owned by Genius Group’s shareholders and
43% owned by FatBrain AI’s shareholders.
- Approvals: All
necessary approvals for the transaction from shareholders, the
board and regulators were received prior to the closing. The
transaction is not a change of control transaction, and thus the
Company believes does not qualify as a significant transaction or
merger which would trigger any valuation provisions under any
Company agreements.
- Market Capitalization of
FatBrain Ai and Genius Group: Based on our 2023 guidance
revenue and post-deal ownership splits of FatBrain AI and Genius
Group, together with Genius Group/’s $0.29 per ordinary share
closing day price on Wed 13 Mar, 2024 – the closing date of the
transaction, this delivers a price / revenue multiple for FatBrain
AI’s once their shares are converted to Genius Group’s of
approximately a 0.4x price / trailing revenue multiple. Genius
Group’s price / trailing revenue multiple by comparison delivers
approximately a 0.85x price / revenue multiple.
- Market Capitalization of
Post-Transaction Group vs Industry Peers: The market
capitalization based on shares issued post-transactions, delivers a
ratio of approximately a 0.65x price / revenue multiple based on
the $0.29 closing date price. This compares to the price / revenue
multiples of publicly listed Edtech peers: As of their current
share prices, Udemy’s price / revenue multiple is 2.73x; Coursera’s
ratio is 3.58x; and Duolingo ratio is 17.5x. This gives our
publicly traded Edtech peers a range of price / revenue multiples
between four times and twenty-seven times Genius Group. We believe
this represents a significant, potential upside in our share price
as we grow and get closer to a fair value in comparison to our
public-listed peers in Edtech.
- Growth Plan: The
plan provides an integrated roadmap and product range to strive to
reach the following: launch 100 Genius Cities, impact 100 million
customers and students and achieve $1 billion in annual revenues
within the next decade, with a shared mission: To build an
AI-driven entrepreneur education and acceleration platform,
empowering our exponential future.”
The Growth Plan will be presented by Roger James Hamilton and
Peter Ritz to investors on Genius Group’s Investor Call on Thursday
March 21, 2024.
About Genius Group
Genius Group is a leading entrepreneur Edtech
and education group, with a mission to disrupt the current
education model with a student-centered, life-long learning
curriculum that prepares students with the leadership,
entrepreneurial and life skills to succeed. Through its learning
platform, GeniusU, the Genius Group has a member base of 5.4
million users in 200 countries, ranging from early age to 100.
For more information, please visit
https://www.geniusgroup.net/
About FatBrain AI
FatBrain AI provides powerful and easy-to-use AI
solutions to empower the enterprise stars of tomorrow to grow,
innovate, and drive the majority of the global economy. FatBrain's
AI 2.0 technologies and advanced data services transform continuous
learning, narrative reasoning, large language models, cloud and
blockchain technologies into auditable, explainable and easy to
integrate AI solutions. FatBrain's subscriptions allow all
companies to deploy its advanced AI solutions quickly, easily, and
securely behind their firewalls or via cloud. FatBrain's global
delivery includes 600+ team across design, development centers in
the US, UK, India and Kazakh Republic.
For more information, please visit
https://Fatbrain AI/
Investor Notice
Investing in our securities involves a high
degree of risk. Before making an investment decision, you should
carefully consider the risks, uncertainties and forward-looking
statements described in our most recent Annual Report on Form 20-F,
as amended for the fiscal year ended December 31, 2022, filed with
the SEC on June 6, 2023 and August 3, 2023. If any of these risks
were to occur, our business, financial condition or results of
operations would likely suffer. In that event, the value of our
securities could decline, and you could lose part or all of
your investment. The risks and uncertainties we describe are not
the only ones facing us. Additional risks not presently known to us
or that we currently deem immaterial may also impair our business
operations. In addition, our past financial performance may not be
a reliable indicator of future performance, and historical trends
should not be used to anticipate results in the future. See
"Forward-Looking Statements" below.
Forward-Looking
Statements
Statements made in this press release include
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements can be
identified by the use of words such as “may,” “will” “plan,”
“should,” “expect,” “anticipate,” “estimate,” “continue,” or
comparable terminology. Such forward-looking statements are
inherently subject to certain risks, trends and uncertainties, many
of which the Company cannot predict with accuracy and some of which
the Company might not even anticipate and involve factors that may
cause actual results to differ materially from those projected or
suggested. Readers are cautioned not to place undue reliance on
these forward-looking statements and are advised to consider the
factors listed above together with the additional factors under the
heading “Risk Factors” in the Company's Annual Reports on Form
20-F, as may be supplemented or amended by the Company's Reports of
a Foreign Private Issuer on Form 6-K. The Company assumes no
obligation to update or supplement forward-looking statements that
become untrue because of subsequent events, new information or
otherwise.
Contacts
Investors:Solomon Bamidele, Investor
RelationsEmail: investor@geniusgroup.net
US Investors: Dave GentryRedChip Companies
Inc1-800-RED-CHIPGNS@redchip.com
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