PITTSBURGH - Smith Micro Software , Inc. (NASDAQ: NASDAQ:SMSI), a software development company specializing in solutions for wireless service providers, has secured approximately $4.1 million through a private placement of shares and warrants.
The transaction involves the sale of 1,910,000 shares of common stock or equivalents at $2.15 each, accompanied by warrants to purchase an additional 1,910,000 shares at $2.34 per share, exercisable six months after the closing date and expiring five and a half years later.
The offering, expected to close on May 14, 2024, is contingent upon standard closing conditions. Smith Micro plans to allocate the net proceeds toward working capital and general corporate purposes.
Roth Capital Partners served as the exclusive placement agent for the offering, while Buchanan Ingersoll & Rooney PC and Nelson, Mullins, Riley & Scarborough LLP provided legal counsel to Smith Micro and the placement agent, respectively.
This financial move follows the effectiveness of a shelf registration statement filed with the SEC on May 12, 2022. The company will also file a prospectus supplement and accompanying base prospectus with the SEC, which will be accessible on the SEC's website.
The warrants were sold in accordance with exemptions from registration under the Securities Act of 1933, as amended, and state securities laws.
Smith Micro Software is known for creating software that enhances mobile experiences, including voice messaging capabilities and solutions for the family digital lifestyle. The company's portfolio spans a variety of applications aimed at enriching connected lifestyles and engaging consumers through smartphones and consumer IoT devices.
This announcement, based on a press release statement.
InvestingPro Insights
In light of Smith Micro Software, Inc.'s recent private placement, investors are keen to understand the company's financial health and market performance. According to real-time data from InvestingPro, Smith Micro Software holds a market capitalization of $22.47 million, with a Price / Book multiple in the last twelve months as of Q1 2024 at a low 0.49. This suggests that the stock may be undervalued relative to the company's book value, potentially offering an attractive entry point for value investors.
Despite the company's efforts to secure additional capital, analysts are projecting a sales decline in the current year, which is reflected in the -23.5% revenue growth over the last twelve months as of Q1 2024. This could be a point of concern for investors looking for growth opportunities. Additionally, the stock has experienced significant price volatility, with a -78.17% one-year price total return, indicating that the stock price has been subject to large fluctuations and may continue to be unpredictable.
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