Innovation Beverage Group Ltd (NASDAQ:IBG) shares are surging on Wednesday after it agreed to merge with BlockFuel Energy Inc., an oil and gas explorer and power generation company supporting Bitcoin (CRYPTO: BTC/USD) mining and high-performance data centers.
Under the deal, IBG will merge with BlockFuel (BFE) in a reverse triangular merger, a newly formed IBG subsidiary will merge with and into BFE, with BFE emerging as the surviving entity and becoming a wholly owned subsidiary.
Upon completion, BlockFuel’s owners are expected to hold about 90% of IBG’s outstanding ordinary shares on a post-transaction basis, subject to specific adjustments related to interim financings.
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The reverse triangular merger is expected to close in the fourth quarter of 2025, subject to customary conditions. Following completion, the combined entity will trade on Nasdaq under the ticker FUEL.
IBG develops and markets a portfolio of more than 60 beverage formulations across 13 alcoholic and non-alcoholic brands.
An independent fairness analysis by Marshall & Stevens Transaction Advisory Services valued the combined entity at between $220 million and $343 million.
Based on those figures, IBG shareholders will own 10% of the merged company, implying a post-transaction equity value of $22 million to $34.3 million, up from a pre-deal valuation of $2.9 million to $6.3 million.
Daniel Lanskey, President and CEO of BlockFuel Energy Inc. and a Director of IBG will become Chairman and Chief Executive Officer of the merged company following the completion of IBG’s merger with BlockFuel.
Sahil Beri, currently chairman and CEO of IBG, will step down from both roles and assume the position of president of a newly formed beverage subsidiary.
“The agreement for our reverse merger transaction with BlockFuel Energy marks a pivotal milestone in the IBG story as we work to maximize shareholder value,” said Sahil Beri, Chief Executive Officer of IBG.
Daniel Lanskey, Executive Chairman of BlockFuel, stated, “With today’s announcement finalizing BlockFuel’s entry into the U.S. capital markets via our reverse merger with IBG, we are well placed to capitalize on significant opportunities across the digital asset, energy capture and oil & gas sectors. Integrating IBG’s public market presence with our advanced energy harnessing and Bitcoin mining technologies creates a powerful foundation for long-term value creation.”
Price Action: IBG shares were trading higher by 29.50% to $4.170 at last check Wednesday.
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