European Guarantee Services S.à.r.l. (EGS) has issued a Letter of Intent to acquire 100 % of all issued and outstanding shares of Cavitation Technologies, Inc. (CVAT) and its affiliates, Alchemy Beverages Inc. and XYRA Corp., in an all‑cash transaction valued at $40 million to $42 million. The LOI, dated March 30 2026, was countersigned by CVAT’s Board of Directors on the same day and sets a valuation of $0.13 per share on a fully diluted basis.
The offer is contingent on several conditions. CVAT must complete due diligence, obtain a fairness opinion from an independent financial advisor, secure shareholder approval, and receive regulatory clearance, including potential review by the Committee on Foreign Investment in the United States (CFIUS). The LOI does not specify a timeline for due diligence or the fairness opinion, but the transaction must satisfy all regulatory and shareholder requirements before closing.
CVAT’s recent financial performance has been challenging. In the third quarter of 2026, the company reported revenue of $76 000 and a net income of $476 000, resulting in a net profit margin of 626.3 %. Earlier, in the third quarter of 2025, CVAT posted a net loss of $258 000, raising concerns about its ability to continue as a going concern. These figures illustrate the financial pressure that may make the acquisition offer attractive to shareholders seeking liquidity.
The acquisition includes two affiliates. Alchemy Beverages Inc. is a subsidiary of CVAT, though limited public information is available about its current operations. XYRA Corp., another CVAT subsidiary, focuses on AI‑driven, quantum‑secure payment infrastructure for remittances and fintech. XYRA has pursued partnerships in Mexico and Honduras and holds a license for CVAT’s Cavitation Non‑Thermal Plasma™ technology, which is used for cooling applications in cryptocurrency mining and data centers.
EGS, a Luxembourg‑based firm that represents high‑net‑worth individuals, family offices, and strategic capital partners, is pursuing the deal to gain exposure to CVAT’s nanotechnology systems for fluid processing and digital asset infrastructure. The strategic rationale appears to be the potential synergies between CVAT’s core technology and EGS’s portfolio of high‑growth, technology‑focused investments.
If the transaction closes, it would provide CVAT shareholders with a substantial liquidity event and could unlock value for the company’s remaining assets and intellectual property. However, the deal’s completion hinges on successful due diligence, a favorable fairness opinion, shareholder approval, and regulatory clearance, including the possibility of a CFIUS review that could delay or block the transaction. The acquisition could also signal a strategic shift for CVAT, potentially redefining its business focus and market positioning.
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