Safe and Green Development Corp to acquire Resource Grou

MIAMI - Safe and Green Development Corporation (NASDAQ: SGD), a company focused on real estate development and innovation, has announced its decision to acquire Resource Group US Holdings LLC, a firm with an exclusive license to a technology that could give it an edge in the composting and engineered soils industry. According to InvestingPro data, SGD currently operates with a weak financial health score of 0.34, carrying significant debt obligations. The acquisition, subject to customary closing conditions and completion of Resource Group’s audit, is expected to close without further contingencies.

SGD aims to utilize Resource Group’s technology to redevelop land opportunities, with plans to shift its primary focus to Resource Group’s core business. This strategic move comes as SGD faces challenging market conditions, with its stock down nearly 92% over the past year and currently trading at $1.11. This strategic move is anticipated to capitalize on growth opportunities and expand SGD’s market presence. InvestingPro subscribers have access to 14 additional key insights about SGD’s financial position and market performance.

Resource Group has reported substantial revenue growth, from $16 million in 2023 to $19.1 million in 2024, both unaudited figures. SGD projects pro forma revenues of approximately $25 million in 2025 following the acquisition. The scalability of Resource Group’s business model is seen as a key driver for expansion in multiple markets, addressing a potential $3.2 billion market in Florida alone.

The proposed transaction will involve SGD issuing shares of restricted common stock under a convertible note to Resource Group’s members at closing. This issuance, along with additional shares equal to 19% of SGD’s outstanding common stock, will constitute 49% of SGD’s outstanding common stock post-closing. The transaction is subject to approval by shareholders, who will be provided with a proxy statement filed with the SEC for voting.

SGD believes the acquisition will significantly enhance shareholder value, despite market recognition not fully reflecting the deal’s transformative potential. The company remains focused on seamless execution of the acquisition and strong financial performance in the future.

This communication is based on a press release statement and contains forward-looking statements regarding the acquisition and its impact on SGD’s revenues and shareholder value. The actual results could differ materially from those projected due to various factors, including the company’s ability to complete the acquisition and leverage Resource Group’s technology effectively. Investors are advised to read the proxy statement and other relevant documents filed with the SEC once available for more detailed information about the proposed transaction.

In other recent news, Safe and Green Development Corporation has announced a definitive agreement to acquire Resource Group US Holdings LLC, a firm specializing in waste-to-value composting, for $480,000 in cash and additional stock considerations. This acquisition, expected to close in the second quarter of 2025, will result in Resource Group’s shareholders owning 49% of Safe and Green’s outstanding common stock. The transaction is anticipated to enhance cash flow and add value to shareholders by leveraging Resource Group’s composting technology. Additionally, Safe and Green has regained compliance with Nasdaq’s stockholders’ equity requirement, as confirmed by a recent SEC filing. The company had previously faced challenges meeting Nasdaq’s minimum criteria but has since resolved these issues, securing its continued listing. Safe and Green has also secured buyers for all five homes in the first phase of its Sugar Joint Venture in Texas, with plans to construct seven more homes by the second quarter of 2025. Furthermore, the company completed the sale of its 10% equity interest in JDI-Cumberland Inlet, LLC, for a $4.5 million promissory note, as part of its compliance plan with Nasdaq. These recent developments highlight Safe and Green’s strategic moves to strengthen its financial position and expand its real estate and composting ventures.

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