AeroClean Technologies and Molekule to Combine in an All-Stock Merger Establishing an Industry-Leading Provider of Premium, FDA-Cleared Air Purification Products and Solutions
AeroClean Technologies, Inc.
Mon, October 3, 2022 at 10:15 PM
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AERC
+11.07%
AeroClean Technologies, Inc.
AeroClean Technologies, Inc.
Transaction Highlights
Creates a pro forma company with a substantial base of revenues, a solid balance sheet and a path to profitability.
A broad range of highly complementary, proprietary and patented, FDA-cleared air purification devices.
Powerful brand value and recognition with an installed base of over 350,000 air purification units, providing a foundation for growing recurring revenues from both consumables and the launch of a SaaS software solution to enable facility managers to monitor and control individual room air quality on an enterprise wide basis.
Expected double-digit organic revenue growth for the combined company, with gross profit expected to grow faster than revenues due to expanding gross margins.
AeroClean (Nasdaq: AERC) will change its name and ticker symbol to Molekule, Inc. (Nasdaq: MKUL).
Amin Khoury will assume a more active role as Non-Executive Chairman at the combined company
AeroClean’s executive team, CEO Jason DiBona and CFO Ryan Tyler, will remain in those roles at the combined company, while Molekule’s CEO Jonathan Harris will transition to CCO (Chief Commercial Officer) of the combined company and Ronti Pal, who leads finance, administration, research and development at Molekule, will become the combined company’s Chief Operating Officer.
The six-member AeroClean Board of Directors will be expanded to seven members, with Brad Feld, Molekule board member and co-founder of venture capital firm Foundry, joining the combined company’s Board.
The combined company’s management and the Board have a track record for high growth and creating category leaders through both organic and inorganic growth.
PALM BEACH GARDENS, Fla., Oct. 03, 2022 (GLOBE NEWSWIRE) -- AeroClean Technologies (“AeroClean” or the “Company”) (Nasdaq: AERC), an air hygiene technology company, and Molekule, Inc. (“Molekule”), a market leader for premium air purifiers, today announced they have entered into a definitive agreement to combine the companies in an all-stock merger. The combined company will have the largest range of proprietary and patented, FDA-cleared air purification devices to address the estimated $15 billion, rapidly growing global air purification market. The combined company is expected to generate approximately $45 million of revenues in FY 2022 on a pro forma combined basis and is expected to have a solid balance sheet with a strong liquidity profile upon consummation of the merger.
Under the terms of the Merger Agreement, which has been unanimously approved by the boards of directors of both companies, AeroClean stockholders will own 50.5%, and Molekule stockholders will own 49.5%, of the outstanding common equity of the combined company on a pro forma basis upon consummation of the merger. AeroClean will change its name and ticker symbol to Molekule, Inc. (Nasdaq: MKUL) upon consummation of the merger. The combined company will remain headquartered in Palm Beach Gardens, Florida, with significant operations in Lakeland, Florida and offices in San Francisco, California.
Amin Khoury, Chairman of the Board of AeroClean, said, “Our complementary operations and cultures and our shared commitment to customer satisfaction will provide us with an enhanced ability to serve our clients and to create value for stockholders. We believe the combined company will be able to generate significant, organic revenue growth particularly in the B2B channel as we begin the roll out our SaaS IAQ solutions. In addition we expect to be well-positioned to pursue additional strategic acquisitions.”
Brad Feld, Molekule board member and Foundry partner, added, “We are pleased to announce the combination of these two strong companies, creating a market leader for premium air purification products. We look forward to working with the AeroClean team, and we are excited about the value creation potential for all stockholders.”
Jason DiBona, CEO of AeroClean, added, “We are excited to be combining with a market leader for premium, proprietary, patented, and FDA-cleared air purification products to capitalize on an estimated $15 billion global air purification market that is projected to double by 2030 based on current growth rates. We expect our combined teams’ expertise and capabilities will drive further innovation and expansion of IoT-enabled indoor air quality (“IAQ”) and SaaS data solutions to support our clients’ sustainability and ESG initiatives.”
Jonathan Harris, CEO of Molekule, who has driven significant growth in his recent roles with Roku and GoPro, added, “Both Molekule and AeroClean contribute unique industry leadership, which we expect will enable the combined company to aggressively innovate and drive greater adoption of our growing range of products and services.”
Compelling Strategic and Financial Benefits
AeroClean and Molekule expect the combined company will realize the following strategic and financial benefits as a result of the merger:
Creation of the First Publicly Traded Provider of a Suite of Premium, Proprietary and Patented, FDA-cleared Air Purification Devices: The combined company’s full range of complementary technologies will include a new generation of IoT-enabled devices and SaaS IAQ solutions which is in development.
Launch of a SaaS Product Offering to Drive Recurring Revenue and Financial Performance: The combined company’s integrated IoT devices and IAQ solutions, including the newly released business software, Molekule Air Platform (MAP), is expected to enable the company to begin to sell monitoring and device control subscriptions that enable facility managers to provide enterprise-wide clean indoor air.
Expedited Opportunities for Commercial Synergies in the B2B space: The combined company’s strategy is to introduce each other’s products into the other’s existing sales and distribution channels to accelerate B2B market penetration and to expand further into healthcare, government, hospitality and education verticals.
Solid Balance Sheet, Liquidity and Access to Capital Provide Opportunities for Growth: On an estimated pro forma combined basis as of September 30, 2022, the combined company would have had approximately $30 million in cash and total long-term debt of approximately $37 million, which is interest-only through April of 2024 and amortizing through April of 2027.
Reinforced Platform for Future M&A: The combined company will be well-positioned to selectively pursue additional value-creating M&A opportunities within the broader IAQ and cleantech industries
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