JanOne Closes Acquisition of ALT 5 Sigma Inc., a Leading Next Generation Blockchain Fintech
JanOne (Nasdaq: JAN) announced on May 16, 2024, the successful acquisition of blockchain fintech ALT 5 Sigma and its subsidiaries. ALT 5, established in 2018, offers blockchain technologies through platforms 'ALT 5 Pay' and 'ALT 5 Prime.' The acquisition comprises 1,799,100 shares of JanOne's common stock, constituting roughly 19.9% of its total outstanding shares, and 34,207 shares of Series B preferred stock. ALT 5's transactional volume reached $1.1 billion last year and $450 million in Q1 of this year. Both companies aim to leverage this acquisition for future growth and diversification.
- Acquisition of ALT 5 Sigma diversifies JanOne's portfolio into the fintech sector.
- ALT 5's transactional processing volume was over $1.1 billion last year and $450 million in Q1 2024.
- JanOne issued 1,799,100 shares of common stock to former ALT 5 stockholders, representing 19.9% of JanOne's total shares, indicating significant investment and potential confidence in the acquisition.
- ALT 5 offers advanced blockchain technologies with 'ALT 5 Pay' and 'ALT 5 Prime' platforms, enhancing JanOne's tech capabilities.
- Being part of a NASDAQ-listed company provides ALT 5 opportunities for higher visibility and expanded growth prospects.
- Issuing 1,799,100 shares of common stock could lead to shareholder dilution, impacting existing shareholders' value.
- ALT 5's Series B preferred stock is non-convertible and non-redeemable, potentially limiting liquidity options for investors.
- The financial burden of integrating ALT 5 could strain JanOne's resources short-term.
Insights
The acquisition of ALT 5 Sigma Inc. by JanOne Inc. is a significant development for JanOne, highlighting its strategic move towards diversification and tapping into the growing fintech sector. Closing this deal potentially opens new revenue streams for JanOne and introduces it to the blockchain and cryptocurrency markets, which have been experiencing substantial growth.
From a financial standpoint, the issuance of approximately 19.9% of JanOne's common stock to ALT 5's former stockholders signifies a substantial dilution of existing shareholders. While this might be a dilution concern in the short term, the long-term benefits could outweigh the initial drawbacks if ALT 5's platforms—ALT 5 Pay and ALT 5 Prime—continue to grow and capitalize on their current transactional volumes.
ALT 5's reported $1.1 billion transactional volume last year and $450 million in the first quarter of this year indicate strong operational performance. These figures suggest a robust user base and a high level of transactions, which could be further leveraged under JanOne's support. However, investors should closely monitor how the integration progresses and whether the expected synergies materialize.
The acquisition brings JanOne into the blockchain and fintech sectors, which are among the fastest-growing industries. The use of blockchain technology for payment processing and over-the-counter trading platforms positions JanOne to benefit from the increasing adoption of digital currencies and the shift towards decentralized finance.
By analyzing industry trends, it's clear that the demand for innovative payment solutions and secure trading platforms is on the rise. ALT 5's products, 'ALT 5 Pay' and 'ALT 5 Prime,' align well with these trends, giving JanOne a competitive edge in these domains. The ability to process high transaction volumes as indicated by ALT 5's past performance will be key to capturing market share. Additionally, this acquisition might enhance JanOne's market valuation by associating with cutting-edge technology and aligning with investor interest in fintech.
The acquisition underscores JanOne's strategic pivot towards integrating blockchain technology into its business model. Blockchain, known for its security, transparency and efficiency, is revolutionizing the financial industry. ALT 5's platforms, 'ALT 5 Pay' and 'ALT 5 Prime,' represent advanced blockchain applications tailored for payment gateways and trading platforms.
'ALT 5 Pay' offers a secure cryptocurrency payment gateway, which is increasingly relevant as more businesses and consumers adopt cryptocurrencies. 'ALT 5 Prime,' an electronic over-the-counter trading platform, caters to the growing demand for flexible and sophisticated trading solutions. The technology behind these platforms could provide JanOne with a significant technological edge, enabling it to offer innovative solutions that meet the evolving needs of the financial market. Integration challenges may arise, but successful execution could position JanOne at the forefront of fintech innovation.
Launched in 2018, ALT 5 is a fintech that provides next generation blockchain-powered technologies to enable a migration to a new global financial paradigm. ALT 5, through its subsidiaries, offers two main platforms to its customers: "ALT 5 Pay" and "ALT 5 Prime." ALT 5 Pay is a crypto-currency payment gateway and ALT 5 Prime is an electronic over-the-counter trading platform. For more details concerning ALT 5 and its platforms and business, please visit https://alt5sigma.com/.
"We are delighted to have closed this acquisition and to be able to welcome ALT 5 officially into the JanOne family," said Tony Isaac, President and CEO of JanOne Inc. "This opens an exciting chapter of diversification and growth of JanOne. We will now work closely together with the team at Alt 5 to identify opportunities for growth of the overall company."
Mr. Andre Beauchesne, President of ALT 5 Sigma Inc., stated, "We are excited to become part of the JanOne public company family. With the completion of this transaction, we will continue to work diligently on expanding our business and leveraging the many benefits of being part of a NASDAQ publicly listed company." Andre further noted that, "ALT 5's transactional processing volume exceeded
Overview of the transaction
At closing, JanOne issued to the former stockholders of ALT 5 an aggregate of (i) 1,799,100 shares of its common stock, which represents approximately
Additional details about the acquisition can be found on JanOne's website at https://ir.janone.com/sec-filings or in JanOne's filings with the Securities and Exchange Commission at https://www.sec.gov/edgar/browse/?CIK=862861&owner=exclude.
About JanOne Inc. — JanOne is a unique Nasdaq-listed company offering innovative, actionable solutions intended to help end the opioid crisis. JanOne is dedicated to funding resources toward innovation, technology, and education to find a key resolution to the national opioid epidemic, which is one of the deadliest and most widespread in the nation's history. Its drugs in the clinical trial pipeline have shown promise for their innovative targeting of the causes of pain as a strategic option for physicians averse to exposing patients to addictive opioids.
About Alt 5 Sigma Inc.
ALT 5 Sigma is a global fintech that provides next generation blockchain powered technologies for the trading, clearing, settlement, payment, and custodianship of digital instruments. ALT 5 was founded by financial industry specialists out of the necessity to provide the digital asset economy with security, accessibility, transparency, and compliance. ALT 5 provides its clients with the ability to buy, sell and hold digital assets in a safe and secure environment deployed with the best practices of the financial industry. ALT 5 Sigma products and services are available to Banks, Broker Dealers, Funds, Family Offices, Professional Traders, Merchants, Digital Asset Exchanges, Digital Asset Brokers, Blockchain Developers, and Financial Information Providers.
Please visit www.janone.com and https://alt5sigma.com/ for additional information.
Forward Looking Statements
This press release contains statements that are forward-looking statements as defined within the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements relating to the statements that JAN 101 will treat PAD, that JAN 123 will treat CRPS, the timing of the commencement of clinical trials, that the FDA will permit approval through a 505(b)(2) pathway for JAN 123, that upon approval JAN 101 will immediately disrupt the PAD market, and other statements, including words such as "continue", "expect", "intend", "will", "hope" "should", "would", "may", "potential" and other similar expressions. This press release also contains statements and links relating to the profitability and prospective growth of ALT 5's platforms and business, including, but not limited to international currency risks, third-party or customer credit risks, liability claims stemming from Alt 5's services, and technology challenges for future growth or expansion. Such statements reflect JanOne's current view with respect to future events, are subject to risks and uncertainties, and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by JanOne, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies.
Many factors could cause JanOne's actual results, performance or achievements to be materially different from any future results, performance or achievements described in this press release. Such factors could include, among others, those detailed in the Company's periodic reports filed with the Securities and Exchange Commission (the "SEC"). Should one or more of these risks or uncertainties materialize, or should the assumptions set out in the section entitled "Risk Factors" in JanOne's filings with the SEC underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this press release and JanOne does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by law. JanOne cannot assure that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Individuals are cautioned that forward-looking statements are not guarantees of future performance and accordingly investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein.
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SOURCE JanOne Inc.
FAQ
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