1606 Corp. (OTCID: CBDW) entered into a non‑binding term sheet on November 18, 2025, giving privately held Sim Agro Inc. a first right of refusal to acquire a controlling interest in the company. The agreement is intended to create a publicly traded platform that Sim Agro can use to raise capital and deploy its power‑generation and data‑center infrastructure strategy for the growing AI and cloud services market.
The term sheet follows 1606’s dramatic shift from a CBD product seller to an AI chatbot developer. For the year ended December 31, 2024, 1606 reported net revenue of $7,195 and a net loss of $4,514,971, raising significant doubt about its ability to continue as a going concern. The company’s cash position is limited, and the acquisition is viewed as a potential lifeline that could provide the capital and infrastructure expertise needed to accelerate its AI product commercialization.
Sim Agro Inc., described in the term sheet as a “privately held power and sustainable‑energy company,” is in fact a small operation with revenue under $1 million and 1–10 employees. The firm operates in the machinery industry, focusing on clean pulp and energy platforms that utilize agricultural residues. While the term sheet portrays Sim Agro as a leading player in power generation, its actual scale is modest, which may influence the pace and scope of the proposed integration and capital‑raising activities.
The strategic rationale for Sim Agro is to use 1606’s public listing as a vehicle to fund the construction and operation of captive power‑generation assets and data‑center infrastructure tailored to AI workloads. The market for reliable, sustainable power for data centers is expanding rapidly, driven by the exponential growth of AI and cloud services. By acquiring 1606, Sim Agro aims to accelerate its entry into this high‑growth segment while leveraging 1606’s existing public platform to attract investment.
Management comments underscore the significance of the deal. 1606 CEO Austen Lambrecht said, “This is an exciting step for 1606. Sim Agro’s extensive experience in developing and operating power plants provides a strong foundation to support the next generation of data centers with reliable, efficient, and sustainable energy.” Sim Agro President Dr. Karthik Raghavan added, “By acquiring 1606, we gain a public‑company platform to raise funds and execute our strategy of delivering reliable power for data centers.”
The transaction remains contingent on due diligence and regulatory approvals. Both parties have indicated that a definitive agreement will be pursued in the coming months, with the expectation that the deal will close once those conditions are satisfied. The term sheet does not disclose financial terms, and the final valuation will be determined after the due‑diligence process.
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