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Guardforce AI (GFAI) Surges 29% on Swooping China Buyouts

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Updated 24 May 2022

Key points:

  • GFAI shares are trading at a premarket gain of nearly 30% following bold acquisition moves
  • The company hopes to move in on China's fast-growing economy and tech epicentre
  • The total buyout cost stands at around $30M

Shares of integrated security provider Guardforce AI (NASDAQ: GFAI) have surged over 40% in the last two days, should today’s premarket gain of 30% hold with the opening bells. The keen buyer interest follows the company’s aggressive acquisition strategy, which has just seen the company enter into two definitive agreements to purchase a total of eight Chinese companies, in a bid to expand its global footprint and move in on market share. Interest in cybersecurity has increased over the last few months due to fears surrounding attacks from Russian hackers amid the ongoing conflict in Ukraine.

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The first agreement is for the acquisition of Beijing Wanjia Security System Limited, an integrated security provider with over 25 years of experience. The buyout cost a total of $8.4M and is expected to close in June this year. The further seven acquisitions lie with a deal with Shenzhen Kewei Robot Technology Co at an aggregate cost of $21.6M.

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All companies involved are key flag bearers of Robotics-as-a-Service technologies, a burgeoning industry that Gaurdforce is honing in on. The total amount of both agreements sits at around $30M, primarily paid by ordinary shares of the company and 10% in cash. 

Lei Wang, CEO of Guardforce AI, commented, “Through these acquisitions, we look forward to accelerating the commercial rollout of our RaaS business initiatives and expanding our integrated security capabilities in China.”

Adding…

“China represents a significant growth opportunity, as it is among the largest and fastest growing economies in the world.  Importantly, these acquisitions bring established management and sales teams with proven track records in their local markets.”

Honing in on China’s tech-central culture presents a strong opportunity for Guardforce AI. As a key industry mover, the company will want to secure roots in fast growing economies across the globe.