Akerna Is A Tilray With Warrants: Assessing The Extreme Arbitrage Play

Seeking Alpha | Jun 25, 2019 at 4:12 PM
  • Announced that it completed a merger with MJ Freeway LLC to Form Akerna Corp.
  • $45.5 million in cash was used to redeem 4,452,042 shares of MTEC common stock so the company has a reasonably strong balance sheet that sits much closer to scenario 2 of the pro forma balance sheet below with approximately $16.5 million in cash (with the trade-off being the much lower than anticipated float).
  • Warrants cannot be exercised and the stock immediately dumped on the market nor can the stock be shorted while simultaneously buying the warrants to lock in profits until the time when the short can be covered with the warrant exercise.