Matinas BioPharma (NYSE:MTNB) Holdings, Inc. (NYSE: MTNB), a biopharmaceutical company, has entered into agreements with healthcare-focused institutional investors to raise approximately $10 million through a registered direct offering.
The transaction includes the sale of over 33 million shares and equal warrants, with each share and accompanying warrant priced at $0.30. The warrants, set at an exercise price of $0.35 per share, will become exercisable six months post-issuance and are valid for five and a half years.
This capital raise, expected to close by April 5, 2024, pending customary closing conditions, will bolster the company's working capital and support general corporate functions. A.G.P./Alliance Global Partners (NYSE:GLP) is serving as the sole placement agent in this offering. This strategic move comes as Matinas BioPharma aims to strengthen its financial position and continue its operations and development activities.
The company's decision to secure funds through a direct offering rather than other financing methods reflects a targeted approach to engage specific institutional investors that have a focus on healthcare. The offering's structure, with the inclusion of warrants, provides an opportunity for investors to potentially increase their investment in the company under predefined terms.
The article is based on an 8K filing.
InvestingPro Insights
As Matinas BioPharma Holdings, Inc. (NYSE: MTNB) navigates a significant capital raise, investors are keenly observing the financial metrics that could influence the company's future. According to real-time data from InvestingPro, Matinas BioPharma currently holds a market capitalization of $76.12 million. Despite a challenging fiscal period with gross profit margins in negative territory at -1028.56% for the last twelve months as of Q4 2023, the company has shown remarkable stock resilience with a 6-month price total return of 185.48%.
InvestingPro Tips indicate that while Matinas BioPharma is quickly burning through cash, it also holds more cash than debt on its balance sheet, which could be a reassuring sign for investors considering the recent direct offering. Additionally, the company has seen a significant return over the last week, with a 20.73% increase in stock price. These insights suggest a complex financial landscape, where potential growth opportunities are weighed against the concerns of profitability and cash burn.
It's worth noting that analysts do not anticipate the company will be profitable this year, yet the company's liquid assets exceed its short-term obligations. For investors looking for a more in-depth analysis, there are over 12 additional InvestingPro Tips available, which can be accessed by visiting https://www.investing.com/pro/MTNB. To enrich your investment strategy further, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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