Riot Blockchain Inc. (NASDAQ:BIOP) traded higher after announcing it had entered into a definitive agreement for the acquisition of a 52% stake in Toronto-based Tess Inc. The stock was up by 7.7% in Tuesday’s trading session to end the day at $8.13 a share.
BIOP Stock Performance
The acquisition reflects a change of focus which has seen Riot Blockchain tweak its operations to focus on the blockchain ecosystem. Given the hype around Bitcoin, the change has helped strengthen investor confidence on the stock. The company joins the likes of MGT Capital Investments Inc. (OTCMKTS:MGTI) and Overstock.com, Inc. (NASDAQ:OSTK) that have seen their share price explode.
Over the past one month, Riot Blockchain Inc. (NASDAQ:BIOP) has gained more than 60% in market value. The stock is also up by more than 100% for the year. Renewed investor interest in the stock does not come as a surprise given that bitcoin has also touched all-time highs in the market over the same period.
Tess’ acquisition will expand Riot Blockchain operations into the payment services business built around blockchain technology. The company is currently developing a guaranteed payment system using blockchain-based escrow service for telecom carriers.
“Our affiliation with Riot Blockchain will give us better access to the capital markets in the United States, as well as the availability of additional senior management resources, all in aid of our ambitious business plans around blockchain,” said TESS CEO, Jeff Mason.
The acquisition of a controlling stake in TESS builds on a strategic investment on Coinsquare, one of Canada’s leading exchanges for digital currencies. Riot Blockchain has reportedly paid a few million dollars for a 12% stake in the company. The investment underscores how committed the company is, in pursuing growth opportunities around blockchain technologies.
Riot Blockchain has already started to divest a number of intellectual Properties tied to the diagnostics industry, as it looks for additional capital to pursue opportunities in the digital currencies business.
Separately, Riot Blockchain Inc. (NASDAQ:BIOP) formerly Bioptix Inc. announced a special dividend of $1 per common share. According to the Chief Executive Officer Michael Beeghley, the dividend underscores the company’s commitment to returning value to shareholders.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.