Tingo Group, Inc. (NASDAQ: TIO), a thriving and rapidly expanding fintech, agri-fintech, and food conglomerate, has officially concluded its meticulous inquiry into the accusations levied against the company by short seller Hindenburg Research. The investigation was conducted under the guidance of the Company’s independent directors and has yielded insightful results regarding the allegations and their validity.
Independent legal counsel, at the behest of the Company’s independent directors, undertook an analysis of certain allegations raised by Hindenburg Research. The initial findings, along with areas warranting further examination, were outlined in an interim report presented to the independent directors. Subsequently, the Company’s external legal advisors initiated their own probe into the allegations, which encompassed a thorough examination of the matters highlighted by the independent counsel. Following an exhaustive investigative process, merging insights from both investigations, Tingo Group is now equipped to deliver a comprehensive response addressing the contentions outlined in the Hindenburg report.
Key Findings and Responses
Agri-Fintech Holdings, Inc. Resignation of Director: Christophe Charlier’s resignation from Agri-Fintech Holdings, Inc., a company distinct from Tingo Group, was acknowledged. Charlier’s role as a co-Chairman of Agri-Fintech Holdings, Inc., and the subsequent sale of Tingo Mobile Limited to Tingo Group were delineated. Notably, Charlier has never held a position on Tingo Group’s Board of Directors or been involved in the Company’s management. His resignation was attributed to communication and collaboration issues within Agri-Fintech Holdings.
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Tingo Foods Financial Performance
The veracity of Tingo Foods’ reported revenue and operating margin for Q1 2023, at 24.8%, was verified.
Tingo Foods Business Relationships
From September 2022 to March 31, 2023, Tingo Foods procured raw crops from two Nigerian organizations, including the All Farmers Association of Nigeria (AFAN). These crops were subsequently supplied to third-party food processors. Processed food products were then distributed to major Nigerian wholesalers, highlighting the Company’s business model.
Food Processing Facility Progress
The construction of Tingo Foods’ processing facility in Nigeria, intended for food and beverage operations, is in advanced stages. Commencement of operations is anticipated in Q2 2024. Notably, the images employed during the groundbreaking ceremony were stock images sourced from an external marketing agency. The actual renderings of the facility are being employed. The Company has contractual agreements in place for the construction of the facility, along with arrangements for a solar power plant to provide energy.
Tingo Mobile’s Relationships with Farming Organizations
Tingo Mobile’s relationships with four farming co-operatives were reconfirmed. It was clarified that Tingo Mobile leases mobile phones to these entities, allowing their members to access services and products.
Mobile License Clarification
Tingo Mobile’s engagement in providing airtime and data services was elucidated. Third-party vendors currently offer these services, absolving Tingo Mobile from the need for a Mobile License from the Nigerian Communications Commission.
Tingo Mobile’s Device Suppliers
The Company’s relationships with its mobile phone suppliers were established, underscoring its association with UGC Technologies Limited and Bullitt Mobile.
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Tingo Mobile’s Tax Compliance
Tingo Mobile’s adherence to tax obligations was emphasized, specifically its payment of corporate income tax and tertiary education tax for the fiscal year 2022 to the Nigeria Federal Inland Revenue Service (FIRS).
Expansion in Ghana
Tingo Mobile’s expansion into Ghana was discussed, highlighting its collaboration with the Ashanti Investment Trust. The Company’s current operations and future plans were delineated.
TingoPay and Partnerships
The Company’s collaborations with Visa and Stanbic Bank were outlined, along with the development of TingoPay and related services.
Nwassa Platform Functionality
The functionality of Tingo Mobile’s Nwassa USSD platform, along with its integration with third-party payment processors, was clarified. The platform’s offerings were detailed, encompassing various financial and transactional services.
Tingo DMCC’s Export Activities
Tingo DMCC’s role as an agricultural export business was highlighted, noting its transactions with neighboring African countries.
Financial Statement Accuracy
Clarification was provided regarding errors highlighted by Hindenburg Research in Tingo Group’s financial statements and MD&A. These were attributed to typographical errors that did not affect the accuracy of the financial data.
Auditor Selection and Bank Balances
The engagement of Brightman Almagor Zohar & Co. for auditing purposes was explained, considering the Company’s operational locations. Additionally, the verification of bank balances through direct engagement with the banks and video conference interviews was outlined.
With the conclusion of the investigation into allegations against the Company and its operations, attention now turns to examining Hindenburg’s allegations against the founder of Tingo Mobile and Tingo Foods, Dozy Mmobuosi.
About Tingo Group: Tingo Group, Inc. (NASDAQ:
TIO) is a global conglomerate comprising fintech, agri-fintech, and food enterprises, operating across Africa, Southeast Asia, and the Middle East. Tingo Group’s various business verticals, including Tingo Mobile, TingoPay, Tingo Foods, and Tingo DMCC, encompass a diverse range of innovative products and services. The Company remains committed to its international expansion and collaborative endeavors, aimed at enhancing the lives of millions.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard