What’s going on with Eric Jackson and SRX Global?
I haven’t kept up with Eric Jackson closely, but he seems to be up to some…interesting things. I first remember him from his absolutely devastating presentation on Marissa Mayer’s terrible tenure at Yahoo. Last year, I was surprised to see him pop up with the crowd pushing Opendoor on socials, going so far as to (bizarrely) post videos of himself outside Drake’s house.
This morning I was looking through random microcaps and came across SRX Global (SRXH), which earns most of its paltry revenue from selling dog food. Jackson has been closely tied to SRX since the firm purchased his AI-crypto-type company, EMJX, in June. What the hell?
The stock has been in total freefall since the deal closed. The December 16 deal announcement initially sent it up 23.8%, to $22.62. Through September 23, it has lost 92.5% of that value.
Digging deeper, I found something else that raised more questions. Jackson was originally supposed to become CEO and chairman, and the company was supposed to go so far as to change its name to EMJX as part of the deal announced last December. Investors had been promised EJ would run the company.
Something happened on the way to the closing
When the deal closed in June, incumbent CEO Kent Cunningham kept his job. Jackson became president of the EMJX platform and head of asset management. The company changed its name from SRx Health Solutions to SRX Global, rather than EMJX, and kept its ticker.
The change in Jackson’s job was agreed to in a March 11 amendment that appeared in an April 14 SEC filing. Jackson signed it. What we haven’t found is a clear explanation of why. An April shareholder letter offered some language about aligning with shareholders. The August earnings call didn’t answer the question either.
Jackson gave slightly more info in a video posted June 26:
“I signed a deal back in December. Along the way, that deal changed. I had a decision to make.”
He doesn’t say why the change was made or who wanted it.
His tone sounds just a little bitter to me. I get the impression there was some acrimony, but there’s a chance I’m reading too much into too little. He’s plainly irritated with online critics and cites Steve Jobs and Elon Musk as models in how he’s going to ignore his critics. He does note that he bought shares of SRX himself before closing and is underwater, along with friends and family who had bought in… So I guess he’s still invested in the deal and making it work?
Jackson and CEO Kent Cunningham are appearing on a webinar September 30th and I’ll definitely be tuning in for that.