Nukkleus Signs Term Sheet for Acquisition of Leading Cross Border Payments Firm Mercury Global

Rhea-AI Summary

Nukkleus Inc. (NASDAQ: NUKK) announces the acquisition of Mercury Global, a cross-border payments firm with operations in London and South Africa. The deal involves acquiring the entire issued share capital of Mercury Global, with a mix of Nukkleus Inc. common stock and cash. The agreement includes earn-out payments based on specific milestones. The transaction is pending regulatory approvals in the UK.

Positive

• Strategic acquisition of Mercury Global to enhance Nukkleus' presence in cross-border payments.
• Deal structured with a mix of Nukkleus Inc. common stock and cash.
• Additional earn-out payments tied to achieving set milestones.
• Transaction contingent on regulatory approvals in the UK.

Negative

• None.

Insights

Financial Analyst

The proposed acquisition of Mercury Global by Nukkleus Inc. represents a strategic initiative aimed at consolidating the company's position within the fintech sector, particularly in the cross-border payments space. From a financial perspective, the structure of the deal, which includes a combination of common stock and cash, along with earn-out payments, suggests a performance-based strategy designed to mitigate upfront cash outlay and align long-term interests between both entities.

By leveraging Mercury Global's regulatory standing in the UK and its strategic presence in South Africa, Nukkleus could potentially tap into the SADC market, which offers a diverse economic landscape. However, the terms of the acquisition, including the initial equity issue and additional earn-out payments, require careful examination of Nukkleus' current liquidity and dilution effects for existing shareholders. The contingent nature of the earn-out payments also introduces performance risk, which should be monitored closely post-acquisition.

Market Research Analyst

The cross-border payments industry is rapidly evolving, driven by increasing globalization and the need for efficient international transactions. Nukkleus' acquisition of Mercury Global could provide them with a competitive edge in this market, given Mercury's established operations in key financial hubs. The move is likely to be scrutinized by investors looking to gauge the potential impact on Nukkleus' market share and revenue growth.

Understanding the synergies between Nukkleus' technology and Mercury Global's banking partnerships will be crucial in evaluating the acquisition's potential to create value. Additionally, the emphasis on milestones related to business volume and client growth indicates a focus on scaling operations, which could lead to increased market penetration and customer acquisition. The impact on the stock market will largely depend on the perceived value of these strategic benefits against the costs of the acquisition.

Legal Expert

The acquisition's dependency on receiving regulatory approvals in the UK underscores the importance of compliance with financial regulations, which are particularly stringent in the realm of cross-border payments. The legal complexities of such a transaction are significant, as it involves navigating multiple jurisdictions with diverse regulatory landscapes. Investors should be aware of the potential for delays or complications arising from this process.

Moreover, the retention of employees and the successful integration of technology are cited as conditions for earn-out payments, highlighting the legal and operational challenges inherent in mergers and acquisitions. It's imperative for Nukkleus to ensure that contractual agreements are structured to protect its interests while facilitating a smooth transition of Mercury Global's operations and workforce.

Mercury Global's strong regulatory standing in the UK, its strategic presence in South Africa as a gateway to the SADC market, and its robust banking partnerships, present an invaluable addition to Nukkleus

NEW YORK--(BUSINESS WIRE)-- Nukkleus Inc. (NASDAQ: NUKK), a pioneering force in the fintech industry, is excited to announce that it has signed a term sheet for the acquisition of Mercury Global, a leading cross-border payments firm with operations in London and South Africa. This significant step marks Nukkleus' strategic move to further strengthen its presence in the dynamic world of cross-border payments.

Under the proposed agreement, Nukkleus is set to acquire the entire issued share capital of Mercury Global, with the purchase price to be settled in a combination of Nukkleus Inc. common stock and cash. The deal includes an initial equity issue at closing, followed by additional earn-out payments in equity and cash. These subsequent payments are contingent upon achieving certain milestones related to business volume and client growth, employee retention, banking relationships, and the successful integration of technology. The transaction is subject to Nukkleus receiving relevant regulatory approvals in the UK.

Emil Assentato, CEO of Nukkleus, shared his enthusiasm about the potential acquisition, highlighting the strategic benefits: "This acquisition is a testament to our commitment to enhancing our cross-border payment capabilities. Mercury Global's strong regulatory standing in the UK, its strategic presence in South Africa as a gateway to the SADC market, and its robust banking partnerships, present an invaluable addition to Nukkleus. We are poised to unlock new and enhanced revenue streams, thanks to increased volumes and an expanded service offering."

Alastair Constance, CEO of Mercury Global commented: "We are excited about the prospect of joining forces with Nukkleus Inc. This strategic move aligns with our vision to expand our cross-border payments capabilities and reach new heights in the fintech industry. Nukkleus' innovative approach and commitment to growth make them the perfect partner as we embark on this journey together."

This strategic move is in line with Nukkleus Inc.'s vision to drive innovation and redefine standards in the financial industry. By integrating Mercury Global, Nukkleus not only strengthens its market position but also enhances its service offerings, ensuring greater efficiency, security, and inclusivity across the financial ecosystem.

About Nukkleus Inc.:
Nukkleus Inc. (NASDAQ: NUKK) is a dynamic fintech aggregator dedicated to revolutionizing the financial services industry. Through strategic acquisitions and technology development, Nukkleus is creating a comprehensive ecosystem that addresses the evolving needs of modern finance. As 'A Gateway to the Future of Finance', Nukkleus is committed to driving growth, fostering innovation, and setting new standards for efficiency, security, and inclusivity in the financial world. For more information about Nukkleus please visit: https://www.nukk.com/.

Financial Products and Services Disclaimer:
Investment in digital assets involves risks, including the lack of regulation and customer protections typical in other financial markets, and is subject to a changing regulatory environment. These assets may lack legal tender status and are not covered by deposit protection insurance. Past performance is not indicative of future results. Local laws and regulations may restrict your ability to transact with us, and some services may not be available in your jurisdiction (e.g., Jacobi Asset Management's fund in the United States, Digital RFQ's licensing). For detailed information on Nukkleus' offerings and regulatory compliance, visit our EDGAR profile: https://www.sec.gov/edgar/browse/?CIK=1787518

Cautionary Note Regarding Forward-Looking Statements:
This press release contains forward-looking statements as defined under U.S. securities laws. These statements, identified by words such as "will," "believe," "anticipate," "contemplate," "expect," "estimate," "intend," "plan," or their negatives or variations of these words, or similar expressions, are not guarantees of future performance and are subject to risks, uncertainties, and assumptions. Actual results may differ materially due to various factors, including our ability to benefit from the business combination, market competition, regulatory changes, and the risks inherent in our industry and operations. Forward-looking statements in this release are based on information available as of the release date and are subject to change. Except as required by law, we do not undertake to update these statements.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240214242450/en/

For further information:

Nukkleus Investor Relations

IR@nukk.com

Source: Nukkleus Inc.

FAQ

What is the ticker symbol for Nukkleus Inc.?

The ticker symbol for Nukkleus Inc. is NUKK.

What is the nature of the acquisition announced by Nukkleus Inc.?

Nukkleus Inc. has signed a term sheet for the acquisition of Mercury Global, a cross-border payments firm with operations in London and South Africa.

How will the purchase price for Mercury Global be settled?

The purchase price for Mercury Global will be settled in a combination of Nukkleus Inc. common stock and cash.

What are the conditions for the earn-out payments in the agreement?

The earn-out payments in the agreement are contingent upon achieving certain milestones related to business volume, client growth, employee retention, banking relationships, and technology integration.

What approvals are required for the transaction to proceed?

The transaction is subject to Nukkleus receiving relevant regulatory approvals in the UK.