NEW YORK - Seelos Therapeutics, Inc. (NASDAQ:SEEL), a biopharmaceutical company specializing in central nervous system disorders and rare diseases, announced a 1-for-16 reverse stock split of its common stock. The change is set to take effect at the start of trading on Friday, September 27, 2024, with the aim of meeting Nasdaq's minimum bid price requirement for continued listing.
The reverse stock split was authorized by the company's Board of Directors under Nevada law and involved filing a Certificate of Change with the Nevada Secretary of State. This corporate action will consolidate every sixteen existing shares of common stock into one share, maintaining the par value of $0.001 per share. No fractional shares will be issued; instead, shareholders will receive a rounded-up whole share in lieu of any fractions.
As a result of the reverse split, the total authorized shares of Seelos Therapeutics will decrease from 50 million to approximately 3.125 million, and the issued and outstanding shares will reduce from about 9.2 million to roughly 581 thousand. The company's stock will continue trading on the Nasdaq Capital Market under the ticker "SEEL" with a new CUSIP number 81577F 406. The reverse split will also proportionately affect the company's outstanding warrants, stock options, and equity incentive plans.
Seelos Therapeutics' portfolio includes late-stage clinical assets aimed at conditions like Major Depressive Disorder, amyotrophic lateral sclerosis, and spinocerebellar ataxia, along with early-stage programs targeting Huntington's, Alzheimer's, and Parkinson's diseases.
The company's forward-looking statements caution that the reverse stock split's desired effect on the stock's bid price and Nasdaq compliance cannot be guaranteed. These statements are subject to market conditions and other uncertainties that could cause actual results to differ from expectations.
The information in this article is based on a press release statement from Seelos Therapeutics, Inc.
In other recent news, Seelos Therapeutics has entered into an agreement with the U.S. Army Medical Materiel Development Activity. The agreement will see the company supply its investigational therapy, SLS-002, for a Department of Defense-funded clinical trial aimed at treating post-traumatic stress disorder among military personnel. The trial, named Military and Veterans Adaptive Platform Clinical Trial, will commence dosing of the SLS-002 cohort before the end of 2024.
In financial developments, Seelos Therapeutics has been granted an extension by the Nasdaq Hearings Panel to meet the exchange's minimum listing requirements. Additionally, the company has amended its financial agreement with Lind Global Asset Management V, LLC, modifying the terms of a Convertible Promissory Note. This amendment stipulates that Seelos is not required to maintain a minimum cash balance until October 31, 2024.
Furthermore, Seelos Therapeutics has implemented a 1-for-8 reverse stock split, converting every eight existing shares of common stock into one. The company has also appointed Richard Pascoe as Chairman of the Board of Directors. These are all recent developments as Seelos continues to navigate its financial obligations and corporate governance responsibilities.
InvestingPro Insights
As Seelos Therapeutics, Inc. (NASDAQ:SEEL) navigates its latest corporate action, a 1-for-16 reverse stock split, investors and market watchers are keenly observing the company's financial health and stock performance. According to InvestingPro data, Seelos has a market capitalization of approximately $2.09 million. The company's revenue growth has been notable, with a 76.05% increase in the last twelve months as of Q2 2024. Despite a challenging financial landscape, Seelos managed to secure a significant return over the last week, with a price total return of 50.18%.
InvestingPro Tips highlight that analysts are expecting sales growth in the current year, which could be a positive signal for investors looking for growth potential. However, it's important to note that Seelos has been dealing with weak gross profit margins, which have been recorded at -915.34% in the same period. With a P/E ratio of 0.11 and an adjusted P/E ratio for the last twelve months of 0.24, the company's earnings valuation appears low, which could potentially indicate undervaluation or reflect underlying financial difficulties.
Investors should also be aware that the company's stock price movements have been quite volatile, as evidenced by a 92.43% drop in the six-month price total return. This volatility is a critical factor to consider when assessing the risk associated with an investment in Seelos. For those interested in a deeper dive into the company's financials and future outlook, there are additional InvestingPro Tips available at InvestingPro, providing a more comprehensive analysis to guide investment decisions.
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