Beneficient Consummates Transaction to Increase Permanent Equity by $35 Million

Rhea-AI Summary

Beneficient (Nasdaq: BENF) announced that its subsidiary Beneficient Company Holdings has completed a transaction to redesignate approximately $35 million of preferred equity as non-redeemable, effectively adding this amount as permanent equity to its balance sheet. Following this transaction, the Company believes it has achieved stockholders' equity of at least $2.5 million, meeting Nasdaq's Minimum Stockholders' Equity Requirement, though final compliance determination remains subject to Nasdaq's review.

Positive

• Addition of $35 million in permanent equity to balance sheet
• Potential compliance with Nasdaq's Minimum Stockholders' Equity Requirement of $2.5 million

Negative

• Final Nasdaq compliance determination still pending
• Previous non-compliance with Nasdaq listing requirements

Insights

Financial Analyst

This equity restructuring marks a important strategic move for Beneficient to maintain its Nasdaq listing. The $35 million conversion of preferred equity to permanent equity significantly strengthens the company's balance sheet position, pushing stockholders' equity above the critical $2.5 million Nasdaq requirement threshold.

The transaction demonstrates management's commitment to maintaining market listing compliance without diluting existing shareholders or taking on additional debt. However, investors should note that this is primarily a technical accounting adjustment rather than new capital injection. While it improves the company's compliance status, the underlying business fundamentals and cash position remain unchanged.

DALLAS, Nov. 22, 2024 (GLOBE NEWSWIRE) -- Beneficient (Nasdaq: BENF) (“Ben” or the “Company”), a technology-enabled financial services holding company announces that its subsidiary Beneficient Company Holdings, L.P. consummated a previously announced transaction pursuant to which approximately $35 million of its preferred equity was redesignated as non-redeemable, resulting in the addition of approximately $35 million of permanent equity on its balance sheet. As a result of the transaction, the Company believes it now has stockholders’ equity of at least $2.5 million, the amount required to regain compliance with Nasdaq’s Minimum Stockholders’ Equity Requirement. The Company’s compliance with Nasdaq’s Minimum Stockholders’ Equity Requirement is subject to Nasdaq’s final determination.

About Beneficient

Beneficient (Nasdaq: BENF) – Ben, for short – is on a mission to democratize the global alternative asset investment market by providing traditionally underserved investors − mid-to-high net worth individuals, small-to-midsized institutions and General Partners seeking exit options, anchor commitments and valued-added services for their funds− with solutions that could help them unlock the value in their alternative assets. Ben’s AltQuote™ tool provides customers with a range of potential exit options within minutes, while customers can log on to the AltAccess^® portal to explore opportunities and receive proposals in a secure online environment.        

Its subsidiary, Beneficient Fiduciary Financial, L.L.C., received its charter under the State of Kansas’ Technology-Enabled Fiduciary Financial Institution (TEFFI) Act and is subject to regulatory oversight by the Office of the State Bank Commissioner.

For more information, visit www.trustben.com or follow us on LinkedIn.

Investors

investors@beneficient.com

Contacts

Matt Kreps: 214-597-8200, mkreps@darrowir.com
Michael Wetherington: 214-284-1199, mwetherington@darrowir.com
Investor Relations: investors@beneficient.com

Disclaimer and Cautionary Note Regarding Forward-Looking Statements

Certain of the statements contained in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can be generally identified by the use of words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and, in each case, their negative or other various or comparable terminology. These forward-looking statements reflect our views with respect to future events as of the date of this document and are based on our management’s current expectations, estimates, forecasts, projections, assumptions, beliefs and information. Although management believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. All such forward-looking statements are subject to risks and uncertainties, many of which are outside of our control, and could cause future events or results to be materially different from those stated or implied in this document. It is not possible to predict or identify all such risks. These risks include, but are not limited to, the risk factors that are described under the section titled “Risk Factors” in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other filings with the Securities and Exchange Commission (the “SEC”). These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this document and in our SEC filings. We expressly disclaim any obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by applicable law.

FAQ

How much permanent equity did Beneficient (BENF) add in November 2023?

Beneficient added approximately $35 million in permanent equity through the redesignation of preferred equity as non-redeemable.

What is the minimum stockholders' equity requirement for BENF to maintain Nasdaq listing?

BENF needs to maintain a minimum stockholders' equity of $2.5 million to comply with Nasdaq's listing requirements.

Has BENF regained compliance with Nasdaq's listing requirements?

While BENF believes it has achieved the required $2.5 million in stockholders' equity, final compliance determination is still subject to Nasdaq's review.