Ideanomics (NASDAQ:IDEX) in June had announced acquiring the remaining stake in Soletrac, an electric tractor maker. The positive news has had done little addition to the stock trading between $2.50 and $3.
It has been seen that the stock closed above $3 for 30 days and 13 below $2.50. The firm’s shares closed less than $3 for over two-thirds of trading days since March commenced. It however scaled to $5.53 in early February.
The acquisition of 78.6% of Solectrac in June would cost $18.1 million in cash, making the total valuation $23 million.
The electric tractor management has three earnouts that may result in Ideanomics shelling an extra $6 million between 2021 and 2023. Furthermore, retention bonuses to the tune of $3 million, will make it a little over $27 million. Ideanomics will be providing $12 million in growth capital to ensure steady investments in Solectracbusiness for three years.
The earnoutstates targets of $6.03 million in 2021, $16.23 million in 2022, and $27.72 million in 2023. Ideanomics in July announced seasoned veteran of the construction and Agri industry, Mani Iyer, would be taking over as CEO of Soletrac, with founder Steve Heckeroth becoming Chairman.
Iyer envisions scaling up the Solectrac business as the company remains an expensive startup, which Ideanomics can afford, considering it had $280 million in net cash on its balance sheet by March-end.
IDEX stock is down 1.50% to $2.34 in the morning session on Wednesday.