The End Game for Jones Soda Has Arrived (JSDA)

Jones Soda (NASDAQ: JSDA) captured the hearts and minds of many investors over the past decade. In the early 2000's Jones Soda was a lowly penny stock with marginal revenues and no earnings trading for as low as $0.17 on the OTC:BB exchange. However beginning in 2003 the company, with then CEO Peter Van Stolk, made a push for vastly wider distribution channels, greater market penetration, and a kitschy image.

At first it worked, with revenues doubling from 2002 to 2006 and earnings increasing 700% from 2003 through 2006. The stock responded in incredible fashion, skyrocketing from $0.17/share in late 2002 to more than $28/share in 2006. This rise was helped by Jim Cramer touting it frequently on his show in 2005/2006 and a move to the NASDAQ stock exchange.

However the rise proved to be temporary, as the cost of the increased distribution and tarnishing of the brand name began to take their toll. Beginning in 2007 the company began to bleed money and the stock again traded in the pennies by 2008.

On Monday Jones Soda management announced a buyout offer from Big Red Holdings Corp. for about $0.30/share (which represented a 55% Discount from what it was trading for at the time of the announcement).

"Adverse economic conditions have continued to negatively impact our liquidity and financial condition and caused us to explore strategic alternatives in an effort to enhance shareholder value. While the board conducts this process, we will continue to focus on executing our strategy," said Jones Soda CEO Joth Ricci.

In other words if they do not accept this deal, Jones is going belly-up soon. Who would have thought after the wild ride the stock saw during the decade it would end up where it started, a $0.30 penny stock.

Jones Soda ended Wednesday up $0.03 or 6.5% to $0.49 on heavy volume.