Aeries Technology, Inc. Fair Value Disclosure
Note 20 - Fair Value Measurements
As of March 31, 2025, the Company had financial instruments which were measured at fair value on a recurring basis using significant unobservable inputs (Level 3). Significant changes in the inputs could result in a significant change in the fair value measurements. See each respective footnote for information on the assumptions used in calculating the fair value of financial instruments.
The following tables present information about the Company’s liabilities that are measured at fair value on a recurring basis as of March 31, 2025 and March 31, 2024, including the fair value hierarchy of the valuation techniques that the Company utilized to determine such fair value.
Summary of Liabilities Measured at Fair Value on a Recurring Basis:
| March 31, 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Liabilities: | ||||||||||||||||
| Forward Purchase Agreement put option liability | $ | $ | $ | 5,034 | $ | 5,034 | ||||||||||
| Public Warrants | 344 | 344 | ||||||||||||||
| Private Placement Warrants | 285 | 285 | ||||||||||||||
| Total liabilities | $ | 344 | $ | $ | 5,319 | $ | 5,663 | |||||||||
| March 31, 2024 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Liabilities: | ||||||||||||||||
| Forward Purchase Agreement put option liability | $ | $ | $ | 10,244 | $ | 10,244 | ||||||||||
| Public Warrants | 747 | 747 | ||||||||||||||
| Private Placement Warrants | 620 | 620 | ||||||||||||||
| Total liabilities | $ | 747 | $ | $ | 10,864 | $ | 11,611 | |||||||||
The change in the fair value of the forward purchase agreement put option liability of $4,585 has been recorded to change in fair value of forward purchase agreement put option liability for the year ended March 31, 2025 and in the Company’s consolidated statements of operations. The forward purchase agreement put option liability was classified as a current liability, as its liquidation is reasonably expected to use or require current assets or the creation of current liabilities. See also Notes 2 and 17. The estimated fair value of the forward purchase agreement put option liability was calculated using a Monte Carlo model and used significant assumptions including the risk-free rate and volatility. The change in fair value of the forward purchase agreement put option liability is primarily driven by a decrease in the price per share of the Company.
As of the date of this Form 10-K report, the remaining balance owed to the FPA holders is $5,034, which may be settled either in cash or in equity, at the option of the investors.
The valuation of the forward purchase agreement put option liability was made using the following assumptions as of March 31, 2025:
| Year Ended March 31, 2025 |
||||
| Expected Term (Years) | ||||
| Risk free Interest Rate | % | |||
| Volatility | % | |||
| Stock price at measurement date | $ | |||
| Year Ended March 31, | ||||||||
| 2024 | 2024 | |||||||
| Weighted Average Fair Value | 10,244 | |||||||
| Expected Term (Years) | ||||||||
| Risk free Interest Rate | % | % | ||||||
| Volatility | % | % | ||||||
| Reference Price for one share of Class A common stock | $ | 10.69 | 2.21 | |||||
| Probability (Weight) - No Dilutive Offering Reset / With Dilutive Offering Reset due to PIPE transaction* | 5 | % | 95 | % | ||||
| Fair Value of Forward Purchase Agreement Put Option Liability [in thousands] | $ | 40,880 | 8,631 | |||||
| Stock price at measurement date | $ | 2.6 | 2.6 | |||||
| Note: | The private placement announced and completed on April 8, 2024. Quoted share price of Class A ordinary shares of the Company when PIPE (Private Investment in Public Entity) transaction took place was $2.21 approx. |
Given that the Public Warrants have a listed price available, the Company classified them as Level 1. The Company has classified the privately placed warrants within Level 3 of the hierarchy as the fair value derived using the Black-Scholes option pricing model, which uses a combination of observable (Level 2) and unobservable (Level 3) inputs. There were no transfers between fair value levels during the year ended March 31, 2025.
The valuation of the liability for the Private Placement Warrants was made using the following assumptions as of March 31, 2025:
| Term (years) | ||||
| Risk-free interest rate | % | |||
| Stock price at measurement date | $ | 0.6 |
The following table presents a summary of the changes in the fair value of Derivative Liabilities:
| Forward Purchase Agreement Put Option Liability |
Public Warrant Liability |
Private Placement Liability |
Total | |||||||||||||
| Fair value at April 1, 2024 | $ | 10,244 | $ | 747 | $ | 620 | $ | 11,611 | ||||||||
| Change in fair value (gain) / loss | (4,585 | ) | (403 | ) | (355 | ) | (5,323 | ) | ||||||||
| Settlement of forward purchase agreement put option liability | (625) | (625) | ||||||||||||||
| Fair value as of March 31, 2025 | $ | 5,034 | $ | 344 | $ | 285 | $ | 5,663 | ||||||||
Based on the expected VWAP as at inception as well as March 31, 2025 it is not expected that ATI would be required to issue additional Class A ordinary shares to certain vendors. On this basis, fair value of the derivative financial instrument representing ATI’s obligation to issue additional Class A ordinary shares has been determined to be insignificant on initial recognition as well as at March 31, 2025 and accordingly the quantitative disclosures in relation to the fair value have not been provided.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jul 2, 2025 | Showing above |
| 2024 | Sep 27, 2024 | |
| 2021 | Apr 1, 2022 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.