NEW YORK - DigiAsia Corp. (NASDAQ: FAAS), an Indonesian Finance as a Service (FaaS) provider, has secured a financial package exceeding $8 million through a Securities Purchase Agreement with Helena Special Opportunities LLC, an affiliate of Helena Partners Inc.
The agreement, announced today, includes the issuance of $3 million in Senior Unsecured Convertible Notes and the conversion of $5.2 million of Class B Convertible Notes from existing debt.
The proceeds from this financing will be directed towards repaying existing debts and for general corporate purposes to support the company's growth. The notes come with a 12% annual interest rate, payable quarterly, and are set to mature one year from the date of issuance. Helena has the option to convert the principal and any unpaid interest into DigiAsia common stock before the maturity date.
Prashant Gokarn, CEO of DigiAsia, expressed confidence in the investment, viewing it as a testament to the company's business prospects and a significant step in their growth strategy. Gokarn highlighted the importance of this capital in empowering small and medium-sized enterprises (SMEs) in Indonesia and contributing to the digital finance economy's transformation in the region.
The investment is intended to bolster economic growth in Indonesia, enhance financial inclusion for the underbanked population, and deliver long-term value to DigiAsia's shareholders. EF Hutton LLC served as the exclusive placement agent for the offering, while Winston & Strawn LLP provided legal counsel to DigiAsia.
This press release includes forward-looking statements, which are based on current expectations and involve risks and uncertainties. These statements are not guarantees of future performance, and actual results may differ materially. DigiAsia has disclaimed any obligation to update forward-looking information in the future.
The information in this article is based on a press release statement from DigiAsia Corp.
InvestingPro Insights
As DigiAsia Corp. (NASDAQ: FAAS) embarks on its growth journey with fresh capital, investors may be evaluating the company's recent financial performance and market position. According to InvestingPro data, DigiAsia's market capitalization stands at a modest $439.15 million, reflecting its status as a relatively smaller player in the Finance as a Service (FaaS) sector. Despite the optimistic outlook from the CEO, the company's Price / Book multiple is high at 12.8 as of the last twelve months ending Q2 2023, indicating a premium market valuation relative to its book value.
From a profitability standpoint, DigiAsia has not been profitable over the last twelve months, with an adjusted P/E Ratio of -74.59. This could signal challenges in turning revenues into net income. However, the company has shown impressive top-line growth with a 93.8% quarterly revenue increase as of Q2 2023, suggesting that its services are gaining traction in the market. This growth narrative aligns with the CEO's confidence and the company's strategic initiatives.
Investors should note the company's significant price volatility and the fact that it does not pay a dividend, as highlighted in InvestingPro Tips. Despite recent setbacks with a one-month price total return of -23.76%, the three-month return has been positive at 23.93%. This volatility could present both risks and opportunities for traders and investors alike. For those seeking a deeper analysis, there are additional InvestingPro Tips available at https://www.investing.com/pro/FAAS, which can provide further insight into DigiAsia's performance and potential. To access these insights, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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