Connexa To Buy 70% Stake In Yuanyu Enterprise For $56 Mln; To Divest Slinger Bag Business

(RTTNews) - Connexa Sports Technologies Inc. (CNXA) announced Thursday that it has signed definitive share purchase and share exchange agreements to acquire a 70% stake in Yuanyu Enterprise Management Co., Limited or YYEM for a combined value of $56 million.

In pre-market activity on Nasdaq, Connexa shares were gaining around 13 percent.

The company also agreed to accept a change-in-control of Connexa, as well as divest the Slinger Bag business to a newly established entity.

Hong Kong -based YYEM operates in the emerging love & marriage market sector with significant proprietary intellectual property. Its matchmaker AI application has the ability to integrate with existing Big Data models and other larger AI models. Additionally, YYEM owns six technologies related to the metaverse and nine AI matchmaking patents.

The transaction will be carried out in two steps, with the purchase of 20% stake for $16.5 million in cash initiallly, and the residual 50% stake completing on the closing date through the issuance of common stock.

As part of the deal structure, there will be a change-in-control of Connexa following the appointment of a new board of directors. Subsequent to this, Slinger Bag Americas will be divested to a newly established entity.

Mike Ballardie, CEO of Connexa, said, "Having come to understand the emerging business sector in which YYEM operates, and in realizing the scope of their growth opportunity, which will be delivered through their plans for organic Asia expansion coupled with an aggressive international licensing program, I am in no doubt that YYEM will provide all existing Connexa shareholders with an associated opportunity to share in their success."