A rugged mobile solutions provider is set to merge with a mystery AI data center firm, giving the latter a quick route to going public.

Nasdaq-listed Sonim Technologies, a provider of rugged mobile phones and other products, this week announced the signing of a non-binding Letter of Intent (LOI) for a proposed reverse take-over (RTO) with a privately owned US-based company that is “building out Nvidia-based high-performance computing (HPC) AI factories.”

Under the proposed agreement, the unnamed HPC company would own the majority of the combined company – and remain public on the Nasdaq stock exchange under a new corporate name.

Sonim is in the midst of a deal to offload most of its business, essentially leaving a corporate shell for the unnamed company to take over.

Sonim said existing shareholders would retain $17.5 million of equity in the merged entity, with the HPC firm valued at $300m.

Details on the unnamed HPC company are sparse. The acquiring company is reportedly “poised for significant growth” by focusing on high-performance computing as a Service (HPCaaS).

“By leveraging their owned data centers, they aim to accelerate expansion, lower operational risks, and tap into the high-margin, fast-growing AI factory market,” Sonim said. “With plans to activate thousands of GPUs in 2025, they're positioning themselves to meet surging demand for the utility of the future, "Intelligence as a Service."

The LOI is non-binding, and the transaction is further subject to customary closing conditions, regulatory approval, approval by Sonim stockholders, and the completion of a previously announced legacy business sale with Social Mobile.

"This transaction positions Sonim stockholders to benefit from the tremendous growth of the AI revolution and represents a transformational step for Sonim and its stockholders," said Mike Mulica, chair of the special committee for Sonim. "The RTO structure allows us to align with a forward-thinking partner in the AI and digital transformation space, leveraging their expertise to create a market-leading, technology-driven enterprise. At the same time, the CVR ensures our stockholders benefit from the successful transition of our legacy business."

Founded in 1999, Sonim Technologies is a US-based provider of rugged mobile solutions, including phones, wireless internet data devices, accessories, and software. It went public in 2019.

The company has had a busy year with regards to its ownership. In January, the firm formed a committee to explore and evaluate strategic alternatives for the company amid takeover interest from existing shareholder Orbic, another firm that develops mobile personal devices.

Orbic announced it had offered to buy out AJP’s stake in Sonim to become the single largest shareholder in the mobile firm. However, in June, Sonim instead announced it had signed an LOI with IoT design firm Social Mobile to offload “substantially all” of Sonim’s assets for $20m.

Rugged smartphone firm Doogee then announced its own higher offer to acquire Sonim, saying it was willing to wait until Social Mobile’s period of exclusivity to make an offer had expired.

Further updates from Sonim derided what it called Orbic’s “illusory” efforts to buy the company, and said it needed more information from Doogee before contemplating a deal. It also hinted at intentions to enter into a reverse takeover in addition to the transaction with Social Mobile.

Existing investors AJP and Orbic issued a statement questioning the recent moves. In an SEC filing, the companies said the Social Mobile deal was “not in the best interest of Sonim’s stockholders as they would not receive a full and fair value of their investments.”

Of the reverse-takeover, the companies said: “The AJP/Orbic Parties have significant doubts that a valuation of this size could be obtained for a public shell. The AJP/Orbic Parties believe that the Special Committee’s assessment of the potential transaction value is overly optimistic and lacks any details or transparency. Stockholders deserve a clear and detailed explanation of how this transaction will benefit them, not vague platitudes.”