Back in April a tiny New Jersey-based deli made headlines after it was valued at $100 million on the stock market, and now we know why.

Last year, the Your Hometown Deli only made $13,976 in revenue, but its market capitalization sat at a ridiculous $113 million. As the sole location for the company Hometown International, the deli quickly created suspicion among traders. It should be noted that the Inside Edition report from up top is from April, when the deli first started to make the news.

The New York Times reports, in an extensive article detailing the bizarre situation, that Hometown International is actually a shell company to allow for an often-criticized process known as a “reverse merger.”

The wrestling coach at the center of the whole saga was fired by the shareholders of the company last month, per NYT. Peter Coker Jr. was appointed CEO in his place, but before that, he had approached Hong Kong hedge fund Maso Capital Partners in 2020 to use Hometown as the shell company for a planned reverse merger. This allows private companies to essentially take the place of any companies already publicly listed on the stock market, hence the “shell” aspect. In turn, this would allow any company doing so to bypass a lot of issues that come with going public.

Essentially, Hometown International, through its sole deli location, was extensively invested in by Maso Capital Partners to get a shortcut into the American marketplace through such a merger. “We took the opportunity to invest in Hometown at a reasonable valuation, with the ability to assist in its acquisition strategy using our extensive network of private companies," said Maso's Manoj Jain, who confirmed plans to enact a reverse merger will go forward.

Jain is currently seeking a company that will merge with Hometown for under $500 million, and when that’s all sorted, the company will take over Hometown with 51 percent of shares or more. “The name changes, the ticker changes, the board changes, the management changes, everything changes as the target company enters the U.S. capital market," Jain added.

Maso Capital has yet to trade any of its shares in the company since the initial investment, which is believed to have happened sometime last year. But of course, this still doesn’t fully explain how Hometown International was able to get such a high valuation. It does partially explain why it got so much attention, though.

The latest news about the whole situation comes after Greenlight Capital founder David Einhorn warned investors to be cautious of Hometown International. “The pastrami must be amazing,” he wrote in the letter, which also criticizes Elon Musk’s influence on the stock market. “Small investors who get sucked into these situations are likely to be harmed eventually, yet the regulators–who are supposed to be protecting investors–appear to be neither present nor curious,” he added. “From a traditional perspective, the market is fractured and possibly in the process of breaking completely."