Internet of Things Inc. Enters Joint Venture Agreement With Chinese Global Conglomerate New Hope Group30 May 2017Posted 2017, News in
$15 Billion New Hope Group & Internet of Things Inc. to Launch JV to Lead the Industrial Iot Market in China
TORONTO, ON & SHANGHAI, CHINA–(May 30, 2017) – Internet of Things Inc. (TSX VENTURE: ITT) (OTC PINK: INOTF) (FRANKFURT: 71T) (“ITT Inc.” or the “Company“) and New Hope Data Technology Co., Ltd. are pleased to announce the signing of a joint venture agreement based on the Letter of Intent announced on March 15, 2017. ITT Inc. is an Internet of Things (“IoT“) software and solutions provider, which acquires and implements strategic and disruptive technology solutions targeting the industrial IoT markets. New Hope Data Technology Co., Ltd., a New Hope Group affiliated and investee company (“New Hope“) provides data acquisition, monitoring, data analytics, professional services and knowledge transfer through the implementation of cutting-edge IoT technologies. New Hope is one of China’s largest privately-owned entities and in the Top 500 Enterprises for 14 consecutive years. With more than 600 subsidiaries and nearly 70,000 employees and annual revenues of approximately 80 Billion Yuan or $15.5 Billion, New Hope is involved in a wide range of sectors, from agriculture and real estate to infrastructure, chemical engineering, finance and insurance. The joint venture will be focused on bringing global industrial IoT solutions to New Hope owned factories, as well as other manufacturing facilities across China and will be called New Hope IoT Intl. Inc. (the “NHG-ITT JV” or the “JV“).
Chinese industries are rapidly modernizing to remain competitive globally. Broad adoption of IoT technologies to improve industrial efficiency could produce cumulative growth for China’s GDP of US$1.8 Trillion by 2030, analysts from Accenture recently reported.
Under the terms of the JV, ITT Inc. will hold a 51% interest and will be responsible for providing global industrial IoT technologies such as sensors, predictive analytics and secured wireless, among other technologies to New Hope’s network of more than 600 factories and businesses, in addition to other customers across mainland China. New Hope will hold a 49% interest in the JV and its sales and marketing team, big data platform and IT consultants will be responsible for the JV day-to-day operations. New Hope will also invest initially $2 Million as an operating and working capital loan into the JV.
As consideration for New Hope entering into the 30-year joint venture partnership and for providing resources, personnel, finance and all other support for the start of the JV, ITT Inc. will issue 28 million common shares to New Hope. These shares will be subject to performance milestones based upon: (i) the JV generating $3.5 million in aggregate net income over the first three years; (ii) annual releases from escrow as net income is achieved on a pro-rata basis; (iii) a 12-month leak-out in 12 equal monthly installments for each annual release of shares; and (iv) regulatory resale restrictions and TSX Venture Exchange approval.
In addition to the JV securing strategic distribution partnerships with various leading IoT technology companies around the world, it also plans to negotiate options to purchase equity in software and solution providers from which it secures distribution rights.
“We are very excited to be launching in China with such a strong joint venture partner in New Hope, who shares our vision and drive in building out the leading Chinese industrial IoT platform. This recurring annual revenue model in partnership with New Hope’s network of factories and businesses is expected to provide ITT Inc. with ongoing revenue and a profitable income stream,” said Michael Frank, CEO of ITT Inc.
Mr. Zhao Gang, Chairman of New Hope Data Technology Co., Ltd. commented, “We have spent the past 14 months working with the ITT Inc. team and we are looking forward to launching the New Hope Data-Internet of Things Inc. JV. New Hope Data has already built out a robust data analytics platform and a professional services team, that currently is working with factories in China to monitor and analyze industrial processes and inputs, converting them into actionable insights and knowledge. This helps the factories’ management teams improve operational stability, product quality, profitability and reduce downtime. We see a significant market gap that can be filled with the products and services that the JV will be providing for our internal network of factories and external customers across China.”
Goldenmount Capital International Inc. acted as an advisor to ITT Inc. on the transaction. ITT Inc. shall pay a finder’s fee of $15,000 in cash and will issue 1.5 million common shares to Goldenmount Capital International Inc. for services provided upon closing, subject to regulatory approval.
About New Hope Group
New Hope Group (en.newhopegroup.com) was founded in 1982. New Hope Group now has more than 600 subsidiaries in 30 countries, with nearly 70,000 employees and annual revenues of nearly 80 Billion Yuan or CAD$15.5 Billion. It is involved in a wide range of sectors, from agriculture and real estate to infrastructure, chemical engineering, finance, insurance and more. It has a AAA credit rating from China Chengxin International Credit Rating Co. Ltd. (CCXI).
New Hope Group includes New Hope Data Technology Co., Ltd, a Shanghai-based company focused on data acquisition, monitoring, analytics, knowledge transfer through the implementation of cutting-edge IoT technologies as well as professional services and data analytics.
About Internet of Things Inc.
Internet of Things Inc. (www.iotintl.com) is an Internet of Things (IoT) software and solutions provider. The company acquires and implements strategic and disruptive technology solutions targeting the industrial IoT markets, including manufacturing, energy management, agriculture, transportation, social, cybersecurity, e-commerce and fintech. ITT has its headquarters in Toronto, Canada.
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Cautionary and Forward-Looking Statements
Except for the statements of historical fact contained herein, certain information presented constitutes “forward-looking information” within the meaning of applicable Canadian securities laws. Such forward-looking information, includes, but is not limited to, the relationship between Company and New Hope, the parties entering into definitive agreements with regard to the joint venture, the use of the Company and the joint venture within the New Hope’s manufacturing processes and projected revenue and income of the joint venture. While such forward-looking statements are expressed by the Company, as stated in this release, in good faith and believed by the Company to have a reasonable basis, they are subject to important risks and uncertainties. As a result of these risks and uncertainties, the events predicted in these forward-looking statements may differ materially from actual results or events. These forward-looking statements are not guarantees of future performance, given that they involve risks and uncertainties. The Company does not undertake any obligation to release publicly revisions to any forward-looking statement, except as may be required under applicable securities laws. Investors should not assume that any lack of update to a previously issued forward-looking statement constitutes a reaffirmation of that statement. Continued reliance on forward-looking statements is at an investors’ own risk.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE
For further information, contact:
Executive Vice-President Industry, Technology & Investments
New Hope Chemical Industry Investment Co., Ltd.
Tel: +86 18081160220
To learn more, visit: www.newhope-data.com
Internet of Things Inc.
President & CEO
Tel: (416) 677-9277
To learn more, visit: www.iotintl.com