La Rosa Holdings Corp. (NASDAQ:LRHC), a Nevada-based real estate company with a market capitalization of $15.15 million and annual revenue of $63.17 million, has completed the acquisition of two of its franchisees, Baxpi Holdings LLC and La Rosa Realty Beaches LLC, as disclosed in a recent SEC filing.
According to InvestingPro analysis, the company currently appears undervalued based on its Fair Value assessment. The transaction, which took place on December 31, 2024, involved a purchase price of $1,136,177.34. This sum was paid partly in cash, with $100,000 up front, and the balance through the issuance of 1,193,752 unregistered shares of La Rosa Holdings' common stock, based on the closing price of $0.868 per share. InvestingPro data reveals the company operates with a moderate level of debt and currently faces challenges with its current ratio of 0.76, indicating potential liquidity concerns.
The shares issued to the selling member of Baxpi and Beaches are subject to a lock-up/leak-out agreement, restricting the sale of the shares to one-twelfth per month after a six-month holding period under SEC Rule 144. This agreement is intended to prevent a sudden influx of shares into the market and to maintain stability in the company's stock price.
The acquisition aligns with La Rosa Holdings' strategic growth plan, bringing the operations of Baxpi and Beaches directly under the corporate umbrella. The integration of these franchises is expected to enhance the company's market presence in the real estate sector.
The unregistered shares were issued in a private transaction, relying on the exemption from registration under Section 4(a)(2) of the Securities Act, which is reserved for transactions not involving a public offering.
This expansion by La Rosa Holdings Corp. reflects the company's ongoing efforts to consolidate its market position and leverage synergies within its franchise network. The transaction details and agreements, including the Purchase Agreement and Lock-up Agreement, are available as exhibits to the SEC filing, providing transparency regarding the terms of the acquisition. InvestingPro subscribers have access to 14 additional key insights about LRHC, including detailed analysis of its financial health and growth prospects.
In other recent news, La Rosa Holdings Corp. has reported a substantial 120% revenue surge for the first nine months of 2024, amounting to an estimated $45 million. The company has also announced plans to acquire a real estate brokerage firm with a 2023 revenue of over $19 million. La Rosa Holdings Corp. has entered into cash advance agreements with Arin Funding LLC and Cedar Advance LLC, selling portions of its future receivables for net advances. The company has also introduced upgrades to its proprietary platform, My Agent Account, enhancing agent productivity. Leadership changes were announced, with Joseph La Rosa stepping in as interim CFO, and Siamack Alavi appointed to the board.
Furthermore, La Rosa Holdings Corp. has embarked on a debt restructuring agreement, deferring payments until 2025 and reducing its debt by approximately 9.5%. Finally, the company plans to acquire BF Prime LLC, expanding its presence into Puerto Rico. These are all recent developments, reflecting the company's commitment to strategic growth and financial transparency.
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