Aetherium Acquisition Corp. Receives Letter of Termination of Business Combination Agreement

Rhea-AI Summary

Aetherium Acquisition Corp (Nasdaq: GMFI) announced receiving a termination notice from Capital A Berhad regarding their business combination agreement dated February 28, 2024. The termination follows Nasdaq's decision to delist Aetherium's securities for failing to meet listing standards, resulting from Capital A's delays in completing Form F-4 submission. Capital A's decision came without prior notice while simultaneously submitting a Regularization Plan to Bursa Malaysia that excludes this merger. Aetherium's board views this unilateral termination as not acting in good faith, especially after receiving regular reassurances about proceeding with the combination.

Positive

• None.

Negative

• Business combination agreement with Capital A Berhad terminated
• Nasdaq delisting of Aetherium's securities
• Failure to meet continued listing standards
• Delays in Form F-4 submission affecting merger completion
• Loss of potential value creation opportunity for shareholders

Insights

Financial Analyst

The termination of the business combination agreement between Aetherium and Capital A Berhad represents a significant negative development for GMFI shareholders. The collapse of this deal, which was meant to merge Capital A's branding business with Aetherium, comes amid concerning circumstances. The sequence of events raises red flags: Capital A's delays in Form F-4 submission led to Aetherium's non-compliance with Nasdaq listing requirements, yet Capital A is using this non-compliance as grounds for termination.

The situation is particularly troubling given that Capital A has simultaneously submitted a Regularization Plan to Bursa Malaysia that excludes this merger. This parallel action suggests potential strategic repositioning at Capital A's end, leaving Aetherium in a precarious position. With Nasdaq delisting concerns and no clear alternative merger target, GMFI faces significant uncertainty. The company's $56.4 million market cap could face pressure as investors reassess the SPAC's prospects for completing a business combination within required timeframes.

Legal Expert

The termination dynamics present notable legal complexities. Capital A's unilateral termination citing Section 9.1(h) of the BCA appears procedurally questionable given their own role in creating the conditions leading to Nasdaq's delisting determination. Aetherium's assertion of 'bad faith' has merit, particularly considering Capital A's continued reassurances and their own delays in Form F-4 submission. The company may have grounds for legal recourse under the BCA's bilateral good faith obligations.

The timing and manner of termination, coupled with Capital A's concurrent RegPlan submission to Bursa Malaysia, could support potential claims for breach of contract or breach of implied covenant of good faith and fair dealing. Shareholders should monitor potential legal proceedings as they could impact both timeline and value recovery options.

GREENWICH, Conn., Oct. 29, 2024 /PRNewswire/ -- Aetherium Acquisition Corp. (Nasdaq: GMFI) ("Aetherium" or "Company") announced today that it received written notice from Capital A Berhad stating that it has elected to unilaterally terminate the business combination agreement dated February 28, 2024, entered into between Capital A Berhad, the Company and other parties named therein (the "Business Combination Agreement" or "BCA"). The Company was not made aware of Capital A Berhad's decision prior to it receiving notice.

The termination was made with reference to Section 9.1(h) of the Business Combination Agreement and relating to Aetherium previously receiving a written determination by Nasdaq to delist Aetherium's securities for failure to meet a continued listing standard. Capital A's management understood the basis for Aetherium's continued non-compliance, which resulted from Capital A's delays in timely completing Form F-4 to submit to the SEC. Prior to Nasdaq's delisting decision, Capital A had fully supported Aetherium through its Nasdaq extension requests and had completed its Form F-4 several months ago. Since then, Aetherium has been waiting for Capital A to submit Form F-4 to the SEC to complete the business combination. 

Aetherium's Board considers this unilateral termination of the BCA while simultaneously submitting a Regularization Plan ("RegPlan") to Bursa Malaysia, which initially included but now excludes this business combination merger is not acting in good faith as is bilaterally stipulated in the BCA. Prior to receiving the notice of termination, Aetherium regularly received reassurances that Capital A would move forward toward completing this business combination.  

Aetherium intends to engage with Capital A's management to determine whether Bursa Malaysia was preventing this transaction, as applying for a listing on Nasdaq is a separate process, and no approvals are required until the SEC process is complete.

"We were disappointed to learn via media reports that Capital A Berhad's board had unilaterally decided to terminate a business combination of its branding business, Capital A International, with Aetherium, a transaction that we believe would have unlocked substantial value for shareholders," said Lim How Teck, an independent director of Aetherium. "This decision, following months of delays by Capital A International in filing the F-4 registration statement that had been prepared, is very concerning. We look forward to learning more and will take all reasonable steps to seek a positive resolution for the shareholders of both companies."

About Aetherium Acquisition Corp.

Aetherium Acquisition Corp. is a blank check company formed to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses. Efforts to identify a prospective target business will not be limited to a particular business, industry sector, or geographical region. However, it intends to focus on companies in Asia (excluding China).

Forward-Looking Statement

This press release contains statements that may constitute "forward-looking statements," including with respect to Aetherium's pursuit of an alternative business combination. No assurance can be given that Aetherium will successfully seek and consummate such an alternative business combination. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of Aetherium, including those set forth in the Risk Factors section of Aetherium's public filings with the Securities and Exchange Commission. Copies are available on the SEC's website, www.sec.gov. Aetherium undertakes no obligation to update these statements for revisions or changes after the date of this release except as required by law.

Aetherium Contact

Info@aetheriumcapital.com

Investor Contact

Crocker Coulson, CEO, AUM Media
+1 (646) 652-7185
crocker.coulson@aummedia.org

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SOURCE Aetherium Acquisition Corp

FAQ

Why did Capital A Berhad terminate the business combination agreement with Aetherium (GMFI)?

Capital A Berhad terminated the agreement citing Nasdaq's decision to delist Aetherium's securities for failing to meet continued listing standards, which resulted from Capital A's own delays in completing Form F-4 submission.

When did Aetherium (GMFI) receive the termination notice from Capital A Berhad?

Aetherium received the written termination notice on October 29, 2024, without prior notification of Capital A Berhad's decision.

What is the impact of the termination on Aetherium's (GMFI) Nasdaq listing?

The termination follows Nasdaq's previous decision to delist Aetherium's securities for failing to meet continued listing standards, further complicating the company's listing status.

What actions is Aetherium (GMFI) taking in response to the termination?

Aetherium intends to engage with Capital A's management to determine if Bursa Malaysia prevented the transaction and will take reasonable steps to seek a positive resolution for shareholders of both companies.