Allurion Announces Launch of Offering of Common Stock and Warrants

Rhea-AI Summary

Allurion Technologies (NYSE: ALUR) has launched a public offering of up to $20 million in common stock and warrants. The offering is managed by Jefferies and TD Cowen, with Roth Capital Partners co-managing. Allurion plans to use the proceeds for clinical trials, commercial sales, R&D, and general corporate purposes. Additionally, RTW Investments has shown interest in purchasing up to $3 million of the securities, potentially through a concurrent private placement of Series A convertible preferred stock. The offering is contingent on SEC registration approval.

Positive

• Planned use of funds for clinical trials, commercial sales, and R&D suggests potential growth.
• RTW Investments' interest in purchasing up to $3 million of securities indicates investor confidence.

Negative

• The offering could dilute existing shareholders' equity.
• The need for SEC registration approval introduces regulatory risk.

Insights

Financial Analyst

The launch of an underwritten public offering by Allurion Technologies signals an important step for the company in terms of capital raising. For investors, this move can be a double-edged sword. On one hand, the influx of up to $20 million could bolster research and development initiatives, particularly the clinical trials that the company aims to fund. This increased capital can also support commercial sales and other corporate purposes, potentially leading to enhanced market penetration and product development.

However, it's critical to consider the potential dilution of existing shares. As new shares are issued, the ownership percentage of existing shareholders will likely diminish, which can impact the stock's valuation negatively in the short term. Additionally, the involvement of RTW in both the public offering and concurrent private placement highlights investor confidence but also introduces some uncertainty, given that their intention is not a binding agreement.

This offering is not yet effective and the stock price may experience volatility until the registration statement becomes effective and the transaction parameters become clearer. Retail investors should carefully consider these factors, balancing the prospects of long-term growth fueled by the new capital against the short-term risks of share dilution and market volatility.

Legal Expert

From a legal standpoint, the structure of this offering raises a few points of interest. First, the issuance of new securities under a registration statement on Form S-1 is a standard approach for public offerings in the United States. However, the concurrent private placement of Series A convertible preferred stock under Section 4(a)(2) of the Securities Act suggests Allurion is looking to tap into exemptions that allow for quicker and potentially less costly capital raising. This maneuver can be particularly advantageous for the company as it avoids the longer regulatory review process typically associated with public offerings.

The terms of the Series A preferred stock, which lack voting rights and are subject to conversion upon shareholder approval, are constructed to align with regulatory requirements while still attracting institutional investment. The interplay between the public offering and the concurrent private placement is crucial— the success of one is contingent on the other, which introduces a layer of legal complexity and risk. Investors should be aware that while these offerings can provide needed capital, they also entail regulatory intricacies that could affect the timing and execution of the capital raising process.

NATICK, Mass.--(BUSINESS WIRE)-- Allurion Technologies, Inc. (NYSE: ALUR) (“Allurion” or the “Company”), a company dedicated to ending obesity, today announced that it has launched an underwritten public offering of up to $20 million of its common stock, par value $0.0001 per share (the “Shares”), and warrants to purchase Shares (the “Warrants” and, together with the Shares, the “Securities”).

Jefferies and TD Cowen are acting as joint book-running managers and representatives of the underwriters for the offering. Roth Capital Partners is acting as co-manager for the offering. The Company expects to grant the underwriters a 30-day option to purchase additional Securities in an amount equal to 15% of the Securities offered in the offering.

The Company intends to use the net proceeds from the underwritten public offering and the concurrent private placement discussed below to continue to fund clinical trials, commercial sales and research and development, and for working capital and general corporate purposes.

RTW Investments (“RTW”) has indicated an interest in purchasing up to $3 million of Securities in the offering and a concurrent private placement of a newly created series of preferred stock, Series A convertible preferred stock (the “Series A Preferred Stock”), and private placement warrants. To the extent that RTW’s purchase of Securities in the offering would result in the issuance of greater than 1% of the common stock of the Company currently outstanding, RTW will acquire shares of Series A Preferred Stock and private placement warrants in the concurrent private placement. The Series A Preferred Stock would not have any voting rights and would automatically convert into Shares upon stockholder approval of such conversion. However, because indications of interest are not binding agreements or commitments to purchase, the underwriters could determine to sell more, fewer or no Securities to RTW, and RTW could determine to purchase more, fewer or no Securities in the offering.

The underwritten public offering is not conditioned on the concurrent private placement. The consummation of the concurrent private placement is, however. conditioned on the closing of the public offering. The securities sold in the concurrent private placement are being issued pursuant to the exemptions provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), have not been registered under the Securities Act or any state or other applicable jurisdiction’s securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state or other jurisdiction's securities laws.

A registration statement on Form S-1 (File No. 333-280466) relating to the Securities being sold in this offering has been filed with the Securities and Exchange Commission (the “SEC”), and is available on the SEC’s website located at www.sec.gov, but has not yet become effective. The Securities may not be sold, nor may offers to buy be accepted, prior to the time such registration statement becomes effective. This offering is being made only by means of a written prospectus. Copies of the preliminary prospectus related to this offering, when available, may be obtained from Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, New York, New York 10022, by telephone at 877-821-7388, or by email at prospectus_department@jefferies.com or TD Securities (USA) LLC, 1 Vanderbilt Avenue, New York, NY 10017, by telephone at (855) 495-9846, or by email at TD.ECM_Prospectus@tdsecurities.com.

This press release does not constitute an offer to sell nor a solicitation of an offer to buy, nor shall there be any sale of the Securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Allurion

Allurion is dedicated to ending obesity. The Allurion Program is a weight loss platform that features the Allurion Gastric Balloon, the world’s first and only swallowable, Procedureless™ intragastric balloon for weight loss, and offers access to the Allurion Virtual Care Suite, including the Allurion Mobile App for consumers, Allurion Insights for health care providers featuring the Coach Iris AI Platform, and the Allurion Connected Scale. The Allurion Virtual Care Suite is also available to providers separately from the Allurion Program to help customize, monitor and manage weight loss therapy for patients regardless of their treatment plan: gastric balloon, surgical, medical or nutritional. The Allurion Gastric Balloon is an investigational device in the United States.

For more information about Allurion and the Allurion Virtual Care Suite, please visit www.allurion.com

Allurion is a trademark of Allurion Technologies, Inc. in the United States and countries around the world.

Forward-Looking Statements

This press release may contain certain forward-looking statements within the meaning of the U.S. federal and state securities laws. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions and include statements regarding the expected completion, timing and size of the proposed public offering and concurrent private placement, the grant to the underwriters of the option to purchase additional securities in the offering, the anticipated use of proceeds of the offering and concurrent private placement, and other statements about future events that reflect the current beliefs and assumptions of Allurion’s management based on information currently available to them and, as a result, are subject to risks and uncertainties. Many factors could cause actual future results or developments to differ materially from the forward-looking statements in this communication, including but not limited to risks related to market conditions and the satisfaction of customary closing conditions related to the proposed offering. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors” section of Allurion’s Annual Report on Form 10-K filed on March 26, 2024 (as amended) and other documents filed by Allurion from time to time with the U.S. Securities and Exchange Commission. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Allurion assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Allurion does not give any assurance that it will achieve its expectations.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240626364783/en/

Global Media

Cedric Damour

PR Manager

+33 7 84 21 02 20

cdamour@allurion.com



Investor:

Mike Cavanaugh, Investor Relations

ICR Westwicke

(617) 877-9641

Mike.cavanaugh@westwicke.com

Source: Allurion Technologies, Inc.

FAQ

What is the value of the common stock and warrants offering launched by Allurion?

Allurion Technologies has launched an offering of up to $20 million in common stock and warrants.

What will Allurion use the proceeds from the offering for?

Allurion plans to use the proceeds to fund clinical trials, commercial sales, research and development, and for working capital and general corporate purposes.

Who are the underwriters and managers for Allurion's public offering?

Jefferies and TD Cowen are acting as joint book-running managers, with Roth Capital Partners acting as co-manager.

What is the significance of RTW Investments' involvement in Allurion's offering?

RTW Investments has indicated interest in purchasing up to $3 million of the securities, which may show investor confidence in Allurion.

What regulatory steps does Allurion's offering need to complete?

The offering requires SEC registration approval, as the relevant registration statement has been filed but not yet become effective.