LISHUI, China – Tantech Holdings Ltd (NASDAQ: TANH), a specialized high-tech enterprise, today announced a private placement agreement with institutional investors to raise approximately $2.1 million in aggregate cash proceeds. The transaction is expected to close on April 24, 2024, subject to customary closing conditions.
The company will issue 4.2 million units, including pre-funded units, at a price of $0.50 per unit. Each unit comprises one common share or a pre-funded warrant, along with two Series A warrants and one Series B warrant.
The Series A warrants are exercisable at $0.75 per share and the Series B warrants at $0.0001 per share, with both having a 5.5-year term from issuance. The number of securities issued may adjust based on certain conditions outlined in the upcoming Report on Form 6-K.
Maxim Group LLC is the sole placement agent for this offering, which is exempt from registration under the Securities Act of 1933 due to its nature as a private placement. Consequently, the securities cannot be reoffered or resold in the United States without registration or an exemption.
Tantech, known for its bamboo charcoal-based products, expanded into vehicle manufacturing and sales after acquiring a majority stake in Shangchi Automobile in 2017. The company also operates two subsidiaries focused on electric vehicles, including street sweepers.
This press release does not constitute an offer to sell the securities mentioned herein, and there will be no sale of these securities in any jurisdiction where such offer, solicitation, or sale would be unlawful before registration or qualification under the securities laws.
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The information in this article is based on a press release statement from Tantech Holdings Ltd.
InvestingPro Insights
Tantech Holdings Ltd (NASDAQ: TANH), which recently announced a private placement to raise capital, is a company that appears to be navigating through challenging financial waters. According to InvestingPro data, Tantech has a market capitalization of just $2.21 million USD, reflecting its position as a relatively small player in the high-tech enterprise sector.
Despite this, the company’s stock is trading at a low Price / Book multiple of 0.02 as of the last twelve months ending Q2 2023, which suggests that the market is valuing the company’s assets conservatively relative to its share price.
From a financial performance perspective, Tantech’s revenue has experienced a decline, with a decrease of 24.9% over the last twelve months as of Q2 2023. This contraction in revenue is further echoed in the quarterly figures, which show a 26.8% drop in the same period. Nevertheless, Tantech has managed to maintain a gross profit margin of 19.6%, indicating some level of resilience in its operational efficiency.
InvestingPro Tips highlight that Tantech holds more cash than debt on its balance sheet and that its liquid assets exceed short-term obligations, which is a positive sign for investors concerned about the company’s financial stability.
Still, the stock has seen significant price volatility and has performed poorly over the last decade, including a substantial price drop of 63.37% over the last year. These factors combined may indicate a higher risk profile for potential investors.
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For those looking to dig deeper into Tantech’s financial health and stock performance, additional insights are available on InvestingPro. Currently, there are 9 more InvestingPro Tips that can help investors make a more informed decision. Interested readers can take advantage of a special offer by using the coupon code PRONEWS24 to get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, which includes access to these valuable tips.
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