Street Calls of the Week
SEVEN HILLS, Australia - Innovation Beverage Group Ltd (NASDAQ:IBG), currently trading at $0.37 with a market capitalization of $3.2 million, announced Tuesday it has entered into a non-binding letter of intent to merge with BlockFuel Energy Inc., a Texas-based company that combines oil and gas exploration with power generation for bitcoin mining operations.
Under the proposed reverse triangular merger, BlockFuel shareholders would receive shares equal to 90% of IBG’s post-transaction common stock. Current IBG CEO Sahil Beri would transition to president of a newly formed Australian beverage subsidiary, while BlockFuel’s Daniel Joseph Lanskey, who is also an IBG director, would become chairman and CEO of the combined company.
According to an independent fairness analysis by Marshall & Stevens Transaction Advisory Services, the post-merger company is expected to have an equity valuation between $220 million and $343 million. This represents a significant increase from IBG’s pre-transaction valuation of $2.9 million to $6.3 million.
BlockFuel has engaged Needham & Company as its investment banking partner for the transaction.
The merger remains subject to several conditions, including completion of due diligence, definitive agreement negotiations, separate financing, stockholder approvals from both companies, and regulatory approvals including Nasdaq listing requirements.
IBG currently develops and markets 60 beverage formulations across 13 alcoholic and non-alcoholic brands, while BlockFuel focuses on utilizing natural gas, including stranded and flared gas, to power bitcoin mining operations and high-performance data centers.
The announcement noted that the terms outlined in the letter of intent are non-binding and may change during final negotiations.
This article is based on a press release statement from Innovation Beverage Group. The company’s stock has declined 87% over the past year, though InvestingPro data suggests it’s currently trading below its Fair Value. Unlock comprehensive valuation metrics and expert insights with an InvestingPro subscription.
In other recent news, Innovation Beverage Group Ltd has announced a five-for-one reverse stock split, which is set to become effective on September 26, 2025. This move comes as part of the company’s efforts to address compliance issues with the Nasdaq Stock Market. Innovation Beverage Group recently received a Staff Delisting Determination Letter from Nasdaq due to not meeting the minimum bid price and stockholders’ equity requirements. The company was notified back in February about its failure to maintain a minimum $1.00 per share closing bid price over 30 consecutive business days. To rectify this, Innovation Beverage Group was given until August 25 to regain compliance with Nasdaq’s listing rules. The reverse stock split is intended to help the company meet these requirements and maintain its listing. Trading on a split-adjusted basis will begin soon, with the shares continuing under the same symbol but a new CUSIP number.
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