Innovative Food Holdings Inc. (OTC: IVFH) Stock Surges 10% After Acquisition News
In light of the 10% gain recorded by the stock last Friday, it could be a good time for investors to consider keeping an eye on Innovative Food Holdings Inc. (OTC: IVFH) this week. The rally came about following a key announcement from the company.
Innovative Food Holdings, Inc. announces the acquisition of assets of Golden Organics, a Denver-based specialty distributor.
The company announced on October 18 that it had reached a material, definitive agreement with regards to the 100% acquisition of the Denver, Colorado-based Golden Organics LLC. Innovative Food Holdings stated that the acquisition would be completed in a transaction worth $1.75 million, out of which $1.4 million would be in cash. The rest of the $350000 would consist of a 5-year seller’s note carrying interest of 6%.
The Acquisition
Golden Organics had been established in 1994 as a specialty food distribution outfit involved in distributing premium organic food in the Rocky Mountain region. The company primarily focused on dry-good specialty food products. In the news release, it was stated that in excess of 85% of the products distributed by Golden Organics are certified organic.
Some of the products offered by the company also bear Halal, non-GMO, gluten-free, and kosher certifications. The purchase price also included around $1.4 million in inventory and around $100,000 in PP&E. It remains to be seen if the Innovative Food Holdings stock can gain momentum today or not.
CEO Quote
Chief Executive Officer of IVFH, Bill Bennett, stated, “We’re very enthusiastic about this acquisition, as it helps us launch new categories, enter new markets, and access new customers. This transaction is consistent with our previous commentary about our acquisition search criteria and exceeds our rate of return requirements before including the upside from synergies. We believe the financial terms of this transaction are attractive without factoring in any cost/revenue synergies or long-term strategic implications. That said, the core motivations behind this transaction are squarely rooted in the long-term strategic implications of building out the IVFH platform. By paying a fair price for a profitable and growing business, including the downside protection of receiving shelf-stable inventory equal in value to our cash outlay, all profit synergies achieved by this acquisition should provide material incremental shareholder value.”
Technicals
| +/- EMA(20) | 1.36 (+9.56%) |
| +/- SMA(50) | 1.35 (+10.37%) |
| +/- SMA(200) | 1.11 (+34.23%) |
| 5-Day Perf. | +7.97% |
| 1-Month Perf. | +14.7% |
| 3-Month Perf. | +20.16% |
| 6-Month Perf. | +50.51% |
| YTD Perf. | +102.01% |
| 1-Year Perf. | +134.65% |
| RSI(14) | 65.76 |
| ATR(14) | 0.07 |
| ADX(14) | 25.48 |
| Beta (5Y) | 0.77 |