Bastion Trading Limited is pressing SkyAI, Inc. to raise its cash tender price to at least $3.50 and revise warrant eligibility, challenging the board’s plan after SkyAI sold its Solana (SOL) holdings.
SkyAI launched the offer Oct. 16 at $3 per common share. For each eligible warrant, the payment is $3 minus its $0.0001 exercise price. Under the current terms, a fully subscribed offer would cost about $201.3 million. SkyAI reported about $223.8 million in cash as of Oct. 16, after completing its Solana sales.
The offer covers up to 95% of each of four classes: common shares, cash pre-funded warrants, cryptocurrency pre-funded warrants and strategic advisor warrants. SkyAI says the caps would leave securities outstanding and retain cash for operations. Its board cited liquidity for holders and a return of capital as reasons for the offer. In an earlier announcement, the company said it expected the proposed transaction to optimize its capital structure.
Bastion said it and certain affiliates beneficially own approximately 9.99% of SkyAI’s outstanding common stock. It wants SkyAI to accept up to 100% of each pre-funded warrant class and exclude the strategic advisor warrants. Bastion says those changes would benefit common shareholders and pre-funded warrant holders.
Bastion alleged that the strategic advisor warrants were granted without a cash payment to an entity controlled by the brother of SkyAI director and Chief Investment Officer Alice Zhang. A SkyAI filing identifies the recipient as Sol Markets, which received the warrants under an advisory agreement and is controlled by James Zhang, Alice Zhang’s brother.
Bastion also asked Executive Chairman Paul K. Danner III and directors Soren Bo Christiansen, Timothy J. Ruemler and Jason L. Monroe to account for their oversight of the Solana sales and tender offer. It said they should resign if they cannot demonstrate meaningful oversight. If they believe they retain shareholders’ confidence, Bastion asked Danner to convene a special meeting so investors can decide who serves on the board.
The offer is scheduled to expire Oct. 29 unless SkyAI extends or ends it early.
