Update on ParagonEX and Global Fintech Holdings

FinTelegram started the coverage of ParagonEX, MICT, BNN Technology, and Global Fintech Holding at the beginning of June 2019. As reported, the merger is expected to result in a new fintech company listed on the NASDAQ by way of a reverse takeover (RTO). The shares of Fintech Holdings Ltd are to be listed on NASDAQ upon completion of the transaction. The exciting thing about this project is the past of the ParagonEX group and its protagonists Haim Toledano and Saar Pilosof. They are also behind the Forex broker UFX and were also responsible for the operation of the Ubinary binary options scam. UFX and its people and entities are mentioned in the Panama Papers.

Termination of tender offer

Shortly after the reports of FinTelegram, MICT and its shareholder BNN Technology PLC (UK) announced that they have terminated their previously announced tender offer to purchase up to 1,953,423 shares of the common stock of MICT, Inc. (NASDAQ: MICT) at a purchase price of $1.65 per share, net to the seller, in cash. Rather, MICT would now raise between $9M and $16.5M fresh money via a capital increase with a private investor group subject to NASDAQ approval.

Saving millions

This termination of the tender offer certainly makes sense for the people of ParagonEX, BNN Technology, and their investors. It saves them having to purchase additional shares on the market and to pay up to $3.2M to the existing MICT shareholders.

Alternatively, the majority of the MICT share capital can also be obtained by diluting the existing shareholders via a capital increase. According to BNN Technology‘s statement on its website, the details of the transaction should be available on MICT’s website (www.micronet-enertec.com). So far, the details are not available on the website or in SEC Filings. We will continue to report as soon as we have the detailed information.

The $300M Reverse Takeover on NASDAQ

The ParagonEX group is currently conducting a sort of reverse takeover with the NASDAQ-listed MICT Inc (see SEC filing) to form Global Fintech Holding Ltd. MICT will be acquired by the newly established Global Fintech Holdings Ltd which will succeed MICT as the Nasdaq-listed company. The transaction was based on an equity valuation of approximately $165 million for ParagonEx and a total equity valuation of approximately $300 million for the combined business.

This transaction is quite remarkable in view of the numerous warnings against UFX from regulators in Europe, Australia, and Canada. Not to forget the history with the Ubinary scheme which has been called out as scam by Forex Peace Army (FPA) and other review sites.