Long Blockchain Corp.'s iced tea unit will be led by a team of beverage-industry veterans after its sale, according to the prospective Canadian buyer.
In January, Farmingdale-based Long Blockchain announced a tentative deal to sell its Long Island Iced Tea business, Long Island Brand Beverages LLC, to a Vancouver investment company, ECC Ventures 2 Corp.
ECC2 executives did not respond to requests for comment. It remained unclear whether the ready-to-drink beverage business would remain on the island for which it was named.
Long Blockchain shares climbed 2.6 percent to 34 cents Wednesday.
Once the transaction is completed, the beverage company's stock is expected replace ECC2's listing on a tier of the Toronto Stock Exchange, which has to approve terms of the sale. Trading on a Canadian exchange does not necessarily mean a company is based there, however.
ECC2 said in a news release Wednesday two executives of Manhattan-based InterContinental Beverage Capital Inc. will share the job of chief executive once the transaction closes. John Carson, former chairman and CEO of Triarc Beverages, the one-time parent of RC Cola and Snapple Beverages, will be one co-CEO. He is currently chairman of InterContinental, a merchant bank focused on the beverage industry.
He will share that role with William Hayde, a director at Long Blockchain and executive vice president and co-founder of InterContinental.
The company's president will be Philip Thomas, who founded Long Island Brand Beverages and served as CEO of the former iteration of Long Blockchain Corp., Long Island Iced Tea Corp.
Scott Ackerman, president and CEO of Emprise Capital Corp., will be a board member.
In December 2017, as frenzied investors bid up prices for the digital currency bitcoin, Long Island Iced Tea announced it was changing its name to Long Blockchain Corp. and shifting its business model to cryptocurrency technologies.
After the announcement, the company's stock spiked as high as $9.49 from the previous day's close of $2.44. Bitcoin has been trading around $4,000 recently, down from about $20,000 in December 2017.
A blockchain is a digital ledger developed to facilitate trading of cryptocurrencies. Major companies, including IBM Corp. and JPMorgan Chase & Co., have been testing other blockchain uses.
In February 2018, Long Blockchain announced a plan to spin off its iced tea business and replaced Thomas with Shamyl Malik, a financial services executive.
By July 2018, the company announced it was forming a subsidiary focused on loyalty and gift card programs for corporate clients and said it was replacing Malik with current CEO Andy Shape.
Wednesday's news release said that ECC2 had agreed to terms of a private placement for at least $2 million to finance the purchase.
Under amended terms of the cash and stock deal, ECC2 said that Long Island Beverages and its security holders will get 15.5 million shares of ECC2 and $500,000. An additional 2.7 million shares of the company will go to some members of the new management team.