Flamingo AI may fold as fire sale falls through
15 June 2020, Written by Matt Ogg
Chatbot developer Flamingo AI (ASX: FGO) is scraping the salt pan after negotiations collapsed to hand over operations and IP in exchange for the payment of accrued wages to employees.
The Software as a Service (SaaS) company reached a binding terms sheet last month with Rymamay Investments to sell all its assets for a nominal consideration of just $100, with the condition the buyer assumed the responsibility of paying $200,000 worth of employee entitlements.
At the time Flamingo forecast a formal deal would be reached by 1 June, but two weeks after that the Sydney-based group has announced the parties could not agree to the terms.
"As a result the Board has determined that unless it is able to find a suitable acquirer for the Intellectual Property or business operations within the next 30 days, it is in the best interests of the shareholders that the Flamingo AI business will be discontinued effective 31 July, 2020," Flamingo AI said.
"The company will continue to explore all avenues to find a suitable acquirer for the business operations and intellectual property."
Flamingo AI expects that after accrued staff entitlements are paid it will have $1.4 million in cash at the end of this month.
Related story: Last dance for Flamingo AI with all assets to be sold
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Author: Matt Ogg