FlyExclusive (FLYX) has agreed to buy Jet.AI's (JTAI) aviation business in an all-stock deal, the companies said Friday.
Shares of FlyExclusive were up nearly 9%, and Jet.AI stock was up 135% in recent pre-market activity.
The agreement follows Jet.AI's plan to concentrate on artificial intelligence products by spinning off its aviation business into a separate entity, which will be purchased by flyExclusive, the companies said.
Jet.AI shareholders will retain their existing shares and receive new class A common stock of flyExclusive upon completion of the transaction.
The purchase price for the transaction is linked to Jet.AI's net cash multiplied by a premium percentage of 115% to 120% while the company is required to maintain at least $12 million in net cash, which factors in cash on hand, agreed net working capital, and transaction costs, according to the companies.
To support the deal, Jet.AI signed a non-binding $50 million term sheet with Hexstone Capital on terms similar to its existing arrangement with Ionic Ventures, according to the statement.
The business combination is expected to close in Q2, subject to financing, regulatory clearance, and shareholder approval, the companies said.
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