aibioImpact BioMedical signs reverse merger agreement with Dr Ashleys Limited
Tickers IBO
Impact BioMedical agreed on June 21, 2025 to a reverse merger with Dr Ashleys, after which Impact holders would own 4.80% of the combined company. Closing needs shareholder approval, an effective registration statement and NYSE American listing approvals.
Key facts
- Company
- Impact BioMedical Inc. (AMEX: IBO)
- News type
- Mergers
- Primary source
- IMPACT BIOMEDICAL INC. Form 8-K filed June 23, 2025 (SEC EDGAR)
Impact BioMedical Inc. (NYSE American: IBO) signed a merger and share exchange agreement on June 21, 2025 with Dr Ashleys Limited, a Cayman Islands company. Under it, Impact would become a subsidiary of Dr Ashleys Limited, which the agreement calls PubCo, and its shareholders would hold 4.80% of PubCo's ordinary shares at closing. The company disclosed the terms in a Form 8-K filed June 23, 2025. The press release describes the deal as a reverse merger, through which Dr Ashleys will take control of the listed company.
The parties and the steps
The agreement is among Impact, PubCo, Dr Ashleys Nevada Sub, Inc., a Nevada subsidiary of PubCo, Dr Ashleys Bio Labs Limited, a Cayman Islands exempted company, and Kanans Visvanats, who signed solely as the sole shareholder of Dr Ashleys Bio Labs Limited.
The deal has two steps. First, the Nevada subsidiary merges into Impact, and Impact survives as a subsidiary of PubCo. Second, PubCo acquires all the shares of Dr Ashleys Bio Labs Limited, which holds Dr Ashleys. Impact is then to be renamed Dr Ashleys USA Inc. Impact's directors and officers as they stand before the effective time will resign, and a board designated by Dr Ashleys will replace them. The press release says the combined company will be run by Dr Ashleys' management team, with a new board that Dr Ashleys will assemble.
Ownership and the reverse split
Impact's common shares convert into PubCo ordinary shares after a reverse stock split at a ratio that Impact and Dr Ashleys agreed. Those shares represent 4.80% of PubCo's ordinary shares at closing. PubCo will issue shares representing 94.20% to Dr Ashleys Bio Labs Limited, before certain compensation shares for Impact's chief executive officer, and shares representing 1.00% to BMI Capital International LLC.
Impact's Series A Preferred Stock converts into common stock before the merger. DSS, Inc. holds a second amended and restated promissory note from Impact dated September 16, 2024, and the holder may convert that debt into Impact shares before the effective time.
Conditions and exit rights
The deal needs approval from the boards and the requisite shareholders of both companies, and an effective registration statement. The 8-K also lists approval of the new shares for listing on NYSE American and conditional approval of an initial listing application with the NYSE. Impact must have net cash of at least $10,000 at closing and net debt of $0 at closing.
Either side can end the agreement if the other breaches its representations, if shareholder approval is not obtained, or by mutual consent. Both sides are barred from soliciting rival proposals, though each may engage with a superior proposal under conditions.
Shareholder support
The 8-K says holders of 86.81% of Impact, on an as-converted basis, signed support agreements in favor of Dr Ashleys Cayman and agreed to vote for the merger. The form of Voting Agreement is filed as Exhibit 10.1. DSS, Inc., PubCo, Impact and Frank D. Heuszel also signed a transition agreement that moves Impact's business to PubCo.
The press release quotes Visvanats, a director of Dr Ashleys Limited, and Heuszel, whom it identifies as chief executive officer of Impact. The release says both boards unanimously approved the transaction.
Advisers and the target
BMI Capital LLC is M&A and capital markets adviser to Dr Ashleys. Robinson & Cole LLP is U.S. legal counsel and Harney Westwood & Riegels is Cayman Islands legal counsel to Dr Ashleys. Sichenzia Ross Ference Carmel LLP is U.S. legal counsel to Impact, and Revere Securities LLC is M&A adviser to Impact. The release names Tsvi Chuck Guy, senior managing director of BMI Capital International LLC, as the investment banking contact.
The press release describes Dr Ashleys Limited as a Hong Kong company making active pharmaceutical ingredients and orphan drugs for rare diseases. The 8-K calls the Hong Kong company a wholly owned subsidiary of Dr Ashleys Bio Labs Limited.
Impact's 10-K, filed March 28, 2025, says it discovers, confirms and patents science and technologies, and that its work covers drug discovery for neurological, oncologic and inflammatory conditions.