TEL AVIV - SciSparc Ltd. (NASDAQ:SPRC), a clinical-stage pharmaceutical company, has announced a definitive merger agreement with AutoMax Motors Ltd., a major vehicle importer in Israel. Under the terms of the agreement, SciSparc will acquire 100% of AutoMax, leading to the creation of a new combined entity.
The acquisition, announced today, follows SciSparc's June 2022 strategic review aimed at maximizing shareholder value. Post-acquisition, SciSparc shareholders are expected to own approximately 50.01% of the combined company's share capital, with AutoMax equity holders owning roughly 49.99%, subject to adjustments.
SciSparc, known for its development of central nervous system therapies, will continue its pharmaceutical operations alongside the new automotive venture. All outstanding shares of AutoMax will be converted into rights to receive ordinary shares of SciSparc upon closing. Additionally, SciSparc has committed to having at least $4.25 million in net cash at the time of the acquisition's completion.
The transaction is contingent on various approvals, including regulatory compliance, Israeli court sanctions, and the consent of both SciSparc and AutoMax shareholders. Notably, Mr. Amitai Weiss serves as chairman for both companies, indicating a shared leadership structure.
SciSparc specializes in cannabinoid-based pharmaceuticals, with a portfolio that includes treatments for Tourette Syndrome, Alzheimer's disease, pain, ASD, and status epilepticus. AutoMax's operations encompass vehicle importation and marketing, including a range of passenger and commercial vehicles, as well as a trade-in service for used cars.
This news article is based on a press release statement and contains only factual information presented in a non-biased manner.
InvestingPro Insights
As SciSparc Ltd. (NASDAQ:SPRC) ventures into a definitive merger with AutoMax Motors Ltd., investors are closely monitoring the company's financial health and market performance. The latest real-time data from InvestingPro provides a snapshot of SciSparc's current market standing:
- The company's market capitalization stands at a modest $1.19 million, reflecting its small-cap status in the market.
- SciSparc's price-to-earnings (P/E) ratio is currently negative at -0.27 for the last twelve months as of Q4 2023, indicating that the company is not profitable at this time.
- Despite significant revenue growth of 113.73% in the last twelve months as of Q4 2023, the company's stock has experienced a steep decline, trading near its 52-week low with a price of $1.73 at the previous close.
InvestingPro Tips highlight several critical factors for investors to consider:
- SciSparc holds more cash than debt on its balance sheet, which could provide some financial stability post-acquisition.
- The stock's Relative Strength Index (RSI) suggests it is in oversold territory, which some investors might interpret as a potential buying opportunity.
For those interested in a deeper analysis, InvestingPro offers additional insights. There are 12 more InvestingPro Tips available, providing a comprehensive view of SciSparc's financial metrics and market performance. These tips can be accessed by visiting InvestingPro's SciSparc page. To benefit from these insights, remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
As SciSparc embarks on this new chapter, combining pharmaceutical innovation with automotive importation, these InvestingPro insights can help shareholders and potential investors make more informed decisions amidst the evolving landscape of the company's operations.
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