Chanticleer spin-off restaurant operations to list on OTC market
BGR’s parent receives $6M infusion, restructures restaurant holdings
Chanticleer Holdings will apply for listing of the shares of its spin-off restaurant operations on the OTC markets OTCQB Exchange. On October 10, Chanticleer proposed a merger agreement with Sonnet BioTherapeutics, a company specializing in the delivery of immunotherapy in the area of oncology. As a result, a Chanticleer spin-off restaurant operations entity will be created, contingent on the merger’s completion. Additionally, Chanticleer will receive $6M in capital to pay off certain debts. The deal is subject to approval of the shareholders of both Sonnet and Chanticleer.
Chanticleer (Nasdaq: BURG) is an operator and franchisor of Hooters restaurants. Additionally it is an owner, operator of franchisor of well-known burger brands, including American Burger Company, BGR – Burgers Grilled Right, Little Big Burger, and also Just Fresh, a healthy-eating chain. Under Chairman and CEO Mike Pruitt’s leadership, the company has engineered some of the most complex financial transactions related to the brands it now franchises.
Eventually, Chanticleer spin-off restaurant operations will apply for Nasdaq listing. Under the merger proposed in October, current Chanticleer shareholders will own six percent of Sonnet’s shares. Meanwhile, Sonnet shareholders will own 94 percent. Existing shareholders will also own the spin-off operations. Additional investment will come via the OTC market. “Our current shareholders will not only maintain their ongoing investment in the restaurant business, but will also have potential upside from the anticipated growth and expansion of Sonnet,” said Pruitt.
Current Chanticleer stockholders will own the spin-off entity. “We believe this new company platform in the spin-off entity will lead to reduced costs while affording us a balance sheet and overhead structure which is better suited for a growing restaurant company, both organically and through potential acquisitions,” added Pruitt.
Furthermore, the new merged company with Sonnet will list with Nasdaq under the SONN symbol as a publicly traded company. It will be formally known as Sonnet BioTherapeutics Holdings, Inc.
Also under the deal, Chanticleer spin-off restaurant operations holds a five year warrant to purchase approximately two percent of the number of shares. Specifically it’s for those issued and outstanding of the Chanticleer at the merger’s completion for $0.01 per share.
Dr. Pankaj Mohan will serve as chairman and chief executive of Sonnet BioTherapeutics Holding. Pruitt is expected to lead the spin-off company, as yet to be named.
Photo credit: BGR
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