ZURICH - Swiss biopharmaceutical company NLS Pharmaceutics Ltd. (NASDAQ:NLSP) has announced a reverse share split of its common shares at a ratio of 1-for-40, to take effect at the opening of the market on September 27, 2024. This decision follows approval from the company's shareholders during an extraordinary meeting held on September 18, 2024.
The reverse split is expected to reduce the number of NLS's outstanding common shares from approximately 46.88 million to around 1.17 million. Shareholders will not receive fractional shares as a result of the reverse split; instead, they will be compensated with cash in lieu of any fractional shares. The company has stated that the reverse split will not significantly alter any shareholder's percentage of ownership or voting power, apart from minimal changes due to the fractional share adjustments.
Upon the reverse split's effectiveness, the company's common shares will continue trading on the Nasdaq Capital Market under the existing ticker symbol "NLSP," albeit with a new CUSIP number, H57830137. The change will be legally effective in Switzerland on the same date, prior to the Nasdaq market opening, and will be recorded in the Swiss commercial registry. Official publication in the Swiss Official Gazette of Commerce is scheduled for October 1, 2024.
NLS Pharmaceutics, founded in 2015 and headquartered in Switzerland, focuses on developing treatments for rare and complex central nervous system disorders. The company collaborates with a network of international scientists and partners to address unmet medical needs.
VStock Transfer, LLC has been appointed as the exchange agent for the reverse split. Shareholders seeking further details are advised to contact VStock Transfer directly.
This restructuring move comes as part of the company's ongoing efforts to manage its capital structure. NLS has emphasized that the reverse split is aimed at increasing the per-share trading price of the company's common shares, which could potentially lead to increased interest from investors and improved trading liquidity.
The information provided is based on a press release statement from NLS Pharmaceutics Ltd. and does not contain any promotional content or endorsements of the company's claims.
In other recent news, NLS Pharmaceutics has announced a strategic merger with Kadimastem Ltd. The merger will result in Kadimastem becoming a wholly owned subsidiary of NLS, enhancing the development of Kadimastem's cell therapy platform. The merged entity will continue to operate under the Kadimastem name. NLS Pharmaceutics also reported successful preclinical results for compounds targeting Parkinson's Disease, specifically the A53T mutation of alpha-synuclein. The company plans to develop two new successors, AEX-230 and AEX-231, for neurodegenerative disorders. In financial developments, NLS Pharmaceutics has entered into an agreement to issue and sell over 3 million common shares and issue warrants in a private placement, with H.C. Wainwright & Co. managing the offering. The company has also been granted an extension by the Nasdaq Hearings Panel to meet the exchange's continued listing requirements.
InvestingPro Insights
In light of NLS Pharmaceutics Ltd.'s (NASDAQ:NLSP) recent announcement of a reverse share split, the latest metrics from InvestingPro provide some context to the company's financial health and market performance. As of the last twelve months ending in Q4 2023, the company's market capitalization stood at a modest $5.91 million. The financial data reveals a challenging picture, with an operating income of approximately -$11.81 million and a similar figure for EBITDA, though there was a growth of 23.76% in EBITDA within the same period. This could indicate some operational improvements despite the overall negative income.
InvestingPro Tips suggest that NLSP has been grappling with weak gross profit margins and is not profitable over the last twelve months, which could be a concern for investors considering the company's future profitability. Additionally, the stock price has shown a significant decline over the past year, with an 81.83% drop in the one-year price total return. The company's shares are currently trading at only 13.69% of their 52-week high, reflecting investor sentiment and market challenges faced by the company.
For investors considering NLSP's stock, it is noteworthy that the company does not pay dividends, which might be a factor for those seeking income from their investments. Furthermore, with the stock often moving in the opposite direction of the market, it suggests a higher level of volatility and potential risk for investors. It is also important to highlight that the company operates with a moderate level of debt, which could be a factor in its strategic financial management decisions, such as the reverse share split.
For a more comprehensive analysis and additional insights, there are over 7 InvestingPro Tips available for NLSP at https://www.investing.com/pro/NLSP, which could further guide investors in their decision-making process.
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