Jet.AI Inc. (NASDAQ:JTAI) stock tumbled in Friday’s premarket session after falling 13.38% in the previous session, as investors continued to take profits following the stock’s explosive rally earlier this week.
The stock has remained highly volatile after the company announced a non-binding letter of intent for a proposed $320 million reverse takeover and the planned spin-off of its data center business.
Reverse Takeover Targets $320 Million Combined Valuation
.Jet.AI said Wednesday it has signed a non-binding letter of intent (LOI) for a reverse takeover with a privately held operating company valued at about $300 million.
If completed, the combined company would carry an estimated valuation of $320 million. Jet.AI shareholders would receive about $20 million in cash and stock, representing roughly $10 per share based on the company’s current shares outstanding.
The identity of the counterparty remains confidential while the parties complete due diligence and negotiate definitive agreements. They expect to announce a final agreement within 90 days and aim to close the transaction before year-end.
Shareholders Could Benefit From Two Transactions
The proposed deal follows Jet.AI’s completed flyExclusive transaction, which returned about $4.60 per share to shareholders. The company said the new transaction could add another $10 per share in stock and cash value.
Following the merger, the combined company is expected to continue trading under the JTAI ticker until the counterparty elects to adopt a new symbol.
As part of the transaction, Jet.AI would also spin off its data center joint venture and its beneficial ownership interest in AI Infrastructure Acquisition Corp. (NYSE:AIIA) into a new publicly traded company.
Existing shareholders would receive shares in the spin-off through a U.S. Securities and Exchange Commission-registered distribution. The company has reserved the Nasdaq ticker DCTR for the new entity.
Transaction Remains Non-Binding
The LOI is non-binding and remains subject to satisfactory completion of due diligence, negotiation and execution of definitive agreements, and board, shareholder and regulatory approvals, including applicable Nasdaq listing requirements.
Jet.AI said there is no assurance that the parties will execute definitive agreements or complete the proposed reverse takeover or the planned spin-off on the terms described, or at all.
Jet.AI Price Action
JTAI Price Action: Jet AI shares were down 12.50% at $2.37 during premarket trading on Friday, according to Benzinga Pro data.
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