The high percentage of shares redeemed in the blank-check deal that took Better Therapeutics public shows that stockholders had enough reliable information about the merger to participate, an attorney for Mountain Crest Capital argued Wednesday before the Delaware Chancery Court.
Mountain Crest, a serial SPAC sponsor, seeks to dismiss an investor’s challenge to the $187 million merger between the digital therapeutics business and the special purpose acquisition company. The investor claims stockholders received misleading information about the transaction that provided a windfall to insiders, Bloomberg reports.
Mountain Crest Acquisition II shareholders approved the deal in October 2021. At that time, shares were trading around $9.30. At the time the lawsuit was filed, Better Therapeutics closed at $1.13. Since then, the company traded OTC as a penny stock begfore shuttering operations in March.
The shareholder filed suit against the SPAC’s sponsors in May 2023, alleging the deal’s lopsided structure gave insiders a huge payday despite virtually wiping out public investors.
Over 84% of shares were redeemed in connection with the deal.
Better Therapeutics is a biotech business focused on cardiometabolic diseases. Read more.
