Torchlight Energy Inc. (NASDAQ: TRCH) stock gained by 15.48% at the last trading close whereas the TRCH stock price projected gains in the pre-market as well by 5.03% while there is no recent news available regarding this surge in TRCH stock price. Torchlight Energy Resources, Inc. (TRCH) is a high-growth oil and gas Exploration and Production (E&P) corporation headquartered in Plano, Texas. Its main goal is to acquire and expand domestic oil fields. Torchlight’s investments are concentrated in West and Central Texas, where proven plays such as the Permian Basin are targeted.
Recent Past Developments
On April 15, 2021, Torchlight Energy updated its closing date for the merger agreement with Metamaterial, a company based in Canada. As a consequence, as soon as the revised merger closing date came out the TRCH stock fell around 18%.
Torchlight and Metamaterial have struck an agreement that isn’t your traditional merger. It’s essentially a way for Metamaterial to list in the United States without having to go through an IPO. Metamaterial does not drill for oil or gas, as its name suggests, but instead works in the chemicals industry. It plans to sell Torchlight’s energy properties after the transaction is completed.
This deal’s completion, though, hasn’t gone as planned. Torchlight revealed on March 15 that the planned closing date for the transaction had to be pushed back, causing the stock to drop sharply. Now, less than a month later, it is revealed that a primary deadline for the contract will be postponed once again. Investors, predictably, responded to that by, driving the stock lower.
Given the peculiar existence of the Torchlight/Metamaterial contract, most buyers would probably choose to stay away. Meanwhile, the continuing delays make the matter much more unclear. Finally, it’s actually better to wait until the two companies complete this merger so customers can get a full view of what the new entity will be like as it emerges from the other side.