8-K: Borealis Foods Completes Business Combination, Commences Trading on Nasdaq

Borealis Foods Inc., a food tech company focused on nutritious food solutions, has completed its business combination and will begin trading on Nasdaq under the ticker BRLS.

Summary

• Borealis Foods Inc. has finalized its business combination with Oxus Acquisition Corp. and will start trading on Nasdaq under the symbol BRLS on February 8, 2024.
• The company is focused on developing affordable and sustainable food products, including ramen meals that are organic, vegan, vegetarian, Halal, Kosher, plant-based, egg and dairy free, non-GMO, MSG free, and TBHQ free.
• Borealis has expanded its distribution to over 21,000 retail locations in the United States, Canada, Mexico and Europe.
• The company has also begun expanding its solutions into school, correctional facility and military food service.
• The business combination was accounted for as a reverse recapitalization, with Borealis being treated as the accounting acquirer.
• Upon closing of the Business Combination, the Company continues to be led by Borealis CEO and Co-Founder Reza Soltanzadeh, and Chairman and Co-Founder Barthelemy Helg.
• The company issued an aggregate of 21,378,890 common shares of New Oxus, which, upon completion of the New Borealis Amalgamation, survived and continued as common shares of New Borealis.
• Borealis common shares were exchanged for shares of New Borealis common shares equal to the quotient of $150,000,000 minus Borealis closing net indebtedness of $17,000,000, which equals $133,000,000, divided by $10.00.
• Each Borealis common share was exchanged for 0.0661 of a New Borealis common share.
• The aggregate transaction consideration was 13,300,000 New Oxus common shares.

Sentiment

Score: 8

Explanation: The document is generally positive, highlighting the successful completion of the business combination and the company's growth prospects. The language is optimistic and forward-looking, suggesting a positive outlook for the company's future.

Positives

• Borealis has a strong focus on developing nutritious and functional food products.
• The company has a commitment to affordability and sustainability.
• Borealis has a rapidly expanding retail distribution footprint.
• The company is expanding its solutions into school, correctional facility and military food service.
• The company has a strategic marketing strategy centered around its partnership with Gordon Ramsay.

Negatives

• The document does not explicitly state any negatives.

Risks

• Borealis has a limited operating history, making it difficult to evaluate its business and prospects.
• The company may be unable to execute its business plan or maintain its competitive position if it fails to maintain adequate operational and financial resources.
• A significant portion of Borealis revenue is concentrated with a limited number of customers.
• Adverse climate conditions may have an adverse effect on Borealis business.
• Borealis dependence on suppliers may materially adversely affect its operating results and financial position.
• Borealis may experience volatility in costs for ingredients and packaging due to conditions that are difficult to predict.
• Borealis future success will depend, in part, on its ability to maintain its technological leadership, enhance its current food products, and develop new food products.
• Borealis business depends on its use of proprietary technology relying heavily on laws to protect.
• New Borealis management team has limited experience managing a public company.
• U.S. shareholders may not be able to obtain judgments or enforce civil liabilities against the company or its executive officers or the New Borealis Board.
• New Borealis will incur significant increased costs as a result of operating as a public company, and its management will be required to devote substantial time to new compliance initiatives.

Future Outlook

Borealis is enthusiastic about its growth outlook, stemming from its unique product offering and vast opportunities in retail and food service. The company is also positioned well for growth due to its extensive distribution footprint and strategic marketing strategy centered around its partnership with Gordon Ramsay.

Management Comments

• Borealis debut on the Nasdaq is an important step in our evolution as we pursue our mission of helping solve the problem of global food nutrition, said Reza Soltanzadeh, Chief Executive Officer of Borealis.
• Our company was founded in 2019 to address and solve a growing global crisis. Millions of people lack access to nutritious food at an affordable price, even in our own country.
• Our innovative, proprietary research and food technology allows us to translate this into shelf-stable, sustainable food that can satisfy peoples needs but at an affordable cost.
• Our commitment to our mission is unwavering; at the same time, we are enthusiastic about our growth outlook, stemming from our unique product offering and vast opportunities in retail and food service.
• Additionally, our extensive distribution footprint and strategic marketing strategy centered around our partnership with Gordon Ramsay position us well for growth.

Industry Context

This announcement reflects a growing trend of food technology companies seeking public market access to fund expansion and innovation. The focus on nutritious, sustainable, and affordable food solutions aligns with increasing consumer demand for healthier and ethically produced products.

Comparison to Industry Standards

• Borealis's focus on plant-based, non-GMO, and allergen-free ramen aligns with the growing health-conscious consumer market, similar to companies like Beyond Meat and Impossible Foods, but in the shelf-stable meal category.
• The company's expansion into school, correctional facility, and military food service mirrors the strategies of large food service providers like Aramark and Sodexo, but with a focus on nutritious and affordable options.
• Borealis's distribution network of over 21,000 retail locations is comparable to established consumer packaged goods companies, indicating a strong market presence.
• The company's partnership with Gordon Ramsay is a unique marketing strategy, similar to celebrity endorsements used by other food brands, but with a focus on a high-profile chef.
• The company's focus on sustainability and recyclable packaging is in line with industry trends towards environmentally responsible practices, similar to companies like Unilever and Nestle.

Management Changes

Corporate Governance

Legal Proceedings

• There is no material litigation, arbitration, or governmental proceeding currently pending against New Borealis or any members of its management team.

Related Party Transactions

• The document references several related party transactions, including debt owed to shareholders and agreements with affiliates, which are detailed in the schedules.

Stakeholder Impact

• Shareholders of Oxus and Borealis have been impacted by the business combination, with Oxus shareholders receiving shares in the new entity and Borealis shareholders exchanging their shares for shares in the new entity.
• Employees of Borealis will continue to be employed by the new entity.
• Customers of Borealis will continue to receive products from the new entity.
• Suppliers of Borealis will continue to provide materials to the new entity.
• Creditors of Borealis will have their debts assumed by the new entity.

Next Steps

• New Borealis common shares and warrants will begin trading on Nasdaq on February 8, 2024.
• The company will continue to pursue its mission of helping solve the problem of global food nutrition.
• The company will continue to develop and expand its product offerings.
• The company will continue to expand its distribution footprint.

Key Dates

Keywords

Borealis Foods, food tech, nutritious food, ramen, Nasdaq, business combination, sustainability, distribution, food service, Gordon Ramsay