Better Choice seals deal to acquire SRx Health Solutions

In a significant development for the beverage industry, Better Choice Co Inc. (NYSE American:BTTR), a Delaware-based company with a market capitalization of $4.5 million and current trading price of $1.87, has entered into a definitive agreement to acquire SRx Health Solutions Inc. According to InvestingPro data, the company maintains a healthy balance sheet with more cash than debt and a current ratio of 2.1x. This all-stock transaction, which was unanimously approved by both companies’ boards, involves Better Choice issuing 30 million shares to SRx shareholders.

The agreement, announced on Tuesday, finalizes the terms of an arrangement that has been amended multiple times since its initial announcement on September 3, 2024. The deal, which has also received approval from the requisite stockholders of both companies and the Ontario Superior Court of Justice, will result in SRx becoming an indirect wholly-owned subsidiary of Better Choice.

The arrangement will see all assets, rights, interests, and obligations of SRx transferred to Amalco, the entity formed by the amalgamation of SRx and AcquireCo, a subsidiary of Better Choice. This strategic move is poised to reshape Better Choice’s position within the market, expanding its portfolio and operational capabilities.

This transaction is a significant milestone for Better Choice, which has been active in the beverages sector under the SIC code 2080. The company, formerly known as Sport Endurance, Inc., has its principal executive offices located at 12400 Race Track Road, Tampa, Florida.

The details of the arrangement were outlined in an 8-K filing with the Securities and Exchange Commission (SEC), providing transparency and official documentation of the agreement. The filing includes forward-looking statements regarding the expected benefits and completion of the transaction, subject to various factors and inherent risks.

As the industry watches this development, Better Choice’s move to acquire SRx Health Solutions marks a notable consolidation within the beverages sector, signaling potential growth and expansion for the company in the competitive market landscape. While the stock has seen a strong return of 10.65% over the last week, InvestingPro analysis indicates the company is currently undervalued based on its Fair Value assessment. For deeper insights into BTTR’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, which provides detailed analysis of this and 1,400+ other US stocks.

In other recent news, Better Choice Company Inc. reported its financial results for the fourth quarter of 2024, showing a significant improvement in its net loss. The company achieved a net loss reduction to $168,000 from $23 million the previous year, despite a 9% drop in annual net revenues to $35 million. The gross profit margin increased by 650 basis points to 37%, highlighting the company’s focus on operational efficiency. In another development, Better Choice announced a merger with SRx Health Solutions, Inc., which involves converting CAD$4 million of SRx Health’s debt into equity. This strategic move aims to strengthen the merged entity without affecting Better Choice’s share count. Additionally, Better Choice has regained compliance with NYSE American’s listing standards after addressing previous financial deficiencies. This compliance is seen as a testament to the company’s disciplined management and financial stabilization efforts. These recent developments indicate Better Choice’s strategic focus on growth and financial health.

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