Company Update (NASDAQ:ETRM): EnteroMedics Inc Announces Pricing of $16.0 Million Public Offering of Common Stock and Warrants
EnteroMedics Inc (NASDAQ:ETRM), a developer and manufacturer of devices that use neuroblocking technology to treat obesity, metabolic diseases, and other gastrointestinal disorders, announced the pricing of its previously announced public offering of 32,000,000 units. Each unit consists of one share of common stock and one Series A warrant to purchase one share of common stock at a purchase price of $0.50 per unit. Investors whose purchase of units in the offering would result in them beneficially owning more than the initial beneficial ownership limitation to be included in the warrants following the consummation of the offering will have the opportunity to acquire units with Series C pre-funded warrants substituted for any common stock they would have otherwise acquired over the initial beneficial ownership limitation, paying the same price of $0.50 per unit. The Series A warrants will be exercisable immediately and will expire 42 months after their date of issuance at an exercise price of $0.60 per share. The pre-funded Series C warrants will be exercisable immediately and will expire five years following issuance.
Canaccord Genuity is acting as sole book-running manager and Craig-Hallum Capital Group is acting as co-manager for the offering. Northland Securities and Roth Capital Partners served as financial advisors to the Company in connection with this transaction.
The offering is expected to close on or about July 8, 2015, subject to customary closing conditions including, but not limited to, the receipt of all necessary regulatory approvals, including the approvals of the NASDAQ Capital Market.
Net proceeds from the offering are expected to be approximately $14.7 million, after deducting underwriting commissions and other expenses related to the offering. The company intends to use the net proceeds from the offering to continue its commercialization efforts, for clinical and product development activities and for other working capital and general corporate purposes. (Original Source – please add link)Shares of Enteromedics closed yesterday at $0.5755 . ETRM has a 1-year high of $2.05 and a 1-year low of $0.50. The stock’s 50-day moving average is $1.06 and its 200-day moving average is $1.13. (Original Source)
On the ratings front, Canaccord Genuity analyst William Plovanic reiterated a Buy rating on ETRM, with a price target of $4, in a report issued on April 8. The current price target represents a potential upside of 589.7% from where the stock is currently trading. According to TipRanks.com, Plovanic has a total average return of 14.1%, a 62.1% success rate, and is ranked #114 out of 3691 analysts.
EnteroMedics Inc is a medical device company. The Company is focused on the design and development of devices that use neuroblocking technology to treat obesity, metabolic diseases and other gastrointestinal disorders.