NEW YORK – Better Choice Company, Inc. (NYSE: BTTR), a pet health and wellness firm, has initiated legal proceedings to enforce an asset sale agreement with Alphia, Inc., a company backed by PAI Partners, a Paris-based private equity firm. Better Choice is pushing for the completion of the sale of its subsidiary, Halo, Purely for Pets, Inc., and is seeking over $19 million in damages due to Alphia's alleged failure to fulfill its contractual obligations.
The dispute centers on a right of first refusal (ROFR) option that Alphia is said to have exercised but not acted upon, according to a statement released today by Better Choice. The company claims that Alphia is legally bound to purchase the assets of Halo, Purely for Pets, and that their inaction has led to significant financial strain on Better Choice.
Michael Young, Chairman of Better Choice, expressed that after several unsuccessful attempts to resolve the matter with Alphia's CEO David McLain and Winston Song of PAI Partners, the company was left with no other choice but to seek legal recourse. Young stated that the lawsuit aims to compel Alphia to complete the transaction or compensate Better Choice for the alleged misconduct.
The legal claim has been filed in the Circuit Court of the 13th Judicial Circuit in Hillsborough County, Florida. The outcome of this action could have implications for both companies, but as of now, the financial and operational impact remains uncertain.
Better Choice Company emphasizes its dedication to providing pet health and wellness products, including a variety of foods, treats, and supplements under the Halo brand. The company positions itself to capitalize on the increasing trend of pet humanization and consumer focus on health and wellness.
This news is based on a press release statement issued by Better Choice Company, Inc.
InvestingPro Insights
Better Choice Company, Inc. (NYSE: BTTR) has been navigating a challenging period, as reflected in the real-time data from InvestingPro. The company's current Market Cap stands at a modest 6.21M USD, indicating a relatively small enterprise size in the financial markets. This is further underscored by a Price / Book ratio of 0.42 as of the last twelve months ending Q3 2023, suggesting that the company is trading at a low valuation relative to its book value, which could be of interest to value-oriented investors.
The latest financial metrics also show a significant Revenue Growth of 10.55% in Q3 2023 on a quarterly basis, pointing to a potential turnaround or positive trend in sales. However, the company's Revenue Growth has decreased by 25.23% over the last twelve months as of Q3 2023, indicating some volatility or challenges in maintaining growth over the longer term.
InvestingPro Tips highlight that Better Choice Company is quickly burning through cash and analysts do not expect the company to be profitable this year. This information is particularly relevant as the company seeks to enforce an asset sale agreement, which could provide essential liquidity if successful. The legal proceedings and their outcome could thus have a significant impact on the company's financial position.
For investors and analysts seeking a deeper dive into Better Choice Company's financials and strategic positioning, there are additional InvestingPro Tips available. These tips may provide further insights into the company's valuation, cash flow, debt levels, and stock performance. To explore these insights, visit https://www.investing.com/pro/BTTR and remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. There are 15 more InvestingPro Tips listed on InvestingPro that can offer a comprehensive view of the company's status and prospects.
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