Sirwin
Sirwin

Blockchain Moon Acquisition Announces Midnight Definitive Agreement


In a bizarre move, blank check firm Blockchain Moon Acquisition (NASDAQ: BMAQ) announced a definitive agreement early Saturday morning, 35 minutes after midnight on Eastern Standard Time. The intended target company is DLTx, a software firm specializing in Web 3 infrastructure construction including decentralized cloud computing, green Bitcoin mining, and decentralized data relay services. According to the press release, "Blockchain Moon will acquire all of the subsidiaries and substantially all of the assets of DLTx ASA."

About DLTx:

DLTx is a vertically integrated technology company expanding Web 3 capabilities by deploying blockchain infrastructure at scale across major global industries. The DLTx team is comprised of decentralists who believe in the new economy that's powered by cryptographic digital assets. The DLTx team has been at the forefront of developing and launching several of the most important protocols in the blockchain space including Ethereum, developed the first blockchain investment fund in 2014, has built out massive scale mining infrastructure since 2015, and now operates the first publicly traded company focused on powering Web 3.

DLTx is based in Oslo and is already publicly traded on the Oslo Stock Exchange. After seeing a peak at the end of 2021 into February 2022, the stock has tumbled along with the broader crypto market. They boast a current market cap equivalent to approximately $191 million USD. 

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The post-merged combined company will be listed on the NASDAQ exchange, trading under the proposed ticker symbol DLTX. The implied initial enterprise value of the company will be approximately $163 million. The transaction is expected to close in the summer of 2023.

The current deadline for BMAQ to consummate a business combination is October 21, 2022. Obviously, they will need more than a week to finalize the deal. It should come as assurance to shareholders that four days before this definitive agreement was announced, the SPAC filed for an extension - assuming shareholders approve it. The meeting to vote on said proposal is October 19, 2022.

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Judging from the filing, it appears that there will be a few more extension votes necessary for a successful business combination. In the definitive agreement press release, they state that the deal is expected to close summer 2023 but the new proposed deadline for a combination is January 21, 2023 though they did add provisions to extended further if necessary. It seems that it will be.

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It seems strange to me for a SPAC to announced a target after midnight, when the markets are closed for the week. Whatever the reason, it's crucial that the shareholders approve the extension vote, or this deal is dead on arrival. 

For what it's worth, Nordea Bank currently owns a 33% stake in DLTx. No investor presentation is yet available, but the appropriate filings should be made with the SEC by Monday.

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