Houston company delisted after reverse takeover snafu

Stabilis Energy has been delisted by Nasdaq as the company didn’t meet the initial listing requirements after its reverse takeover of American Electric Technologies Inc (AETI).

The deal was originally announced in January 2019 and completed in July. AETI, based in Bellaire, was a provider of power systems to the Energy sector but had sold off its main businesses. It just had a business in Brazil and a China JV left. Stabilis, based in the Westchase area of Houston, is a small-scale producer and distributor of Liquefied Natural Gas.

Stabilis is owned by Casey Crenshaw, who had also been a director and shareholder of AETI since 2012. The shareholders of Stabilis ended up owning 90% of the combined company.

Immediately after the transaction was completed, the company received a delisting notice from Nasdaq because it neither had a minimum of 1 million publicly-held shares nor a minimum market value of $15 million for the publicly-held shares. That’s due to Crenshaw owning 77% of the combined company.

On September 10, the company filed a prospectus to sell 2.8 million shares for $17.1 million. Shareholders, other than Crenshaw, are selling. Once completed, this would make Stabilis compliant. Unfortunately, after a hearing, Nasdaq has now determined the company is not currently in compliance and has delisted the shares.

It’s not clear whether or how the delisting will impact the proposed sale of the shares.

The company believes it already meets the listing requirements on other exchanges and plans to regain a listing as soon as this month.

In August the company appointed Andy Puhala as CFO of the combined group. He had been the CFO of Stabilis since November 2018. Ironically he was also the CFO of AETI between January 2013 and September 2015.

SEC filing – Stabilis delisting

Leave a Reply

Your email address will not be published. Required fields are marked *