GYRODYNE ANNOUNCES COMMENCEMENT OF RIGHTS OFFERING
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Insights
The commencement of Gyrodyne's rights offering is a strategic move to raise capital, which could potentially affect the company's liquidity and capital structure. By offering additional shares at a set price of $8.00, the company is directly appealing to its existing shareholder base, which may be viewed favorably as it allows current investors to avoid dilution of their ownership stake. However, the offering price needs to be assessed against current market conditions and the stock's recent performance to determine its attractiveness to shareholders.
Furthermore, it is crucial to consider the intended use of the net proceeds. The focus on pursuing entitlements and capital improvements suggests a long-term investment in the company's core real estate operations, which could enhance future revenue streams. However, the allocation towards litigation fees indicates ongoing legal challenges that could pose risks to investors. These legal proceedings and their outcomes should be monitored closely as they could have significant financial implications.
The mention of litigation fees and expenses in relation to an Article 78 proceeding against Gyrodyne is a critical factor to examine. An Article 78 proceeding is a legal mechanism in New York that allows individuals or entities to appeal the decisions of administrative agencies. The nature of this proceeding suggests that Gyrodyne is involved in a dispute regarding regulatory or governmental action, which could have material consequences on the company's operations, especially concerning its real estate development projects.
Investors should be aware of the potential impact of this litigation on Gyrodyne's financials and operations. The outcome of such legal matters could influence the company's ability to execute its business strategy, particularly in relation to the Flowerfield and Cortlandt Manor properties. A favorable outcome could enhance the value of these assets, while an adverse result might lead to project delays or increased costs.
The allocation of funds from the rights offering towards entitlements and capital improvements in Gyrodyne's real estate portfolio is indicative of the company's growth strategy. Entitlements are a crucial step in real estate development, as they represent the legal method of obtaining approvals for the right to develop a property for a certain use. The success in securing these entitlements could significantly increase the value of the Flowerfield and Cortlandt Manor properties.
Capital improvements, on the other hand, could enhance the attractiveness and functionality of the existing real estate assets, potentially increasing their rental income and occupancy rates. This proactive approach to property management could lead to an appreciation in asset value, benefiting shareholders in the long run. However, the effectiveness of these improvements in driving revenue growth must be weighed against the costs and the current real estate market conditions.
ST. JAMES, N.Y., Feb. 06, 2024 (GLOBE NEWSWIRE) -- Gyrodyne, LLC (“Gyrodyne” or the “Company”) (NASDAQ: GYRO), an owner and manager of a diversified portfolio of real estate properties, today announced the commencement of the subscription period of its rights offering.
As previously announced, the Company intends to raise up to
The Company filed a registration statement (File No. 333-276312) (the “Registration Statement”) with respect to the proposed Rights Offering with the Securities and Exchange Commission (the “SEC”) on December 29, 2023.
In the Rights Offering, the Company will distribute to holders of Gyrodyne’s common shares non-transferable subscription rights to purchase up to an aggregate of 625,000 shares of common stock at a subscription price of
The Company expects to use the net proceeds received from the rights offering to complete the pursuit of entitlements on the Company’s Flowerfield and Cortlandt Manor properties, for litigation fees and expenses in the Article 78 proceeding against the Company, for property purchase agreement negotiation and enforcement, for necessary capital improvements in the Company’s real estate portfolio, and for general working capital.
The subscription rights are exercisable until 5:00 p.m., New York City time, on March 7, 2024. Gyrodyne may extend the rights offering period for additional periods ending no later than April 6, 2024 or cancel the rights offering at any time for any reason.
A registration statement relating to these securities was declared effective by the Securities and Exchange Commission on February 2, 2024.
About Gyrodyne
Gyrodyne, LLC owns and manages a diversified portfolio of real estate properties comprising office, industrial and service-oriented properties in the New York metropolitan area. The Company owns a 63-acre site approximately 50 miles east of New York City on the north shore of Long Island, which includes industrial and office buildings and undeveloped property, and a medical office park in Cortlandt Manor, New York, both of which are the subject of plans to seek value-enhancing entitlements. The Company's common shares are traded on the NASDAQ Capital Market under the symbol GYRO. Additional information about the Company may be found on its web site at www.gyrodyne.com.
Cautionary Statement Regarding Forward-Looking Statements
The statements made in this press release and other materials the Company has filed or may file with the SEC, in each case that are not historical facts, contain "forward-looking information" within the meaning of the Private Securities Litigation Reform Act of 1995, and Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, which can be identified by the use of forward-looking terminology such as "may," "will," "anticipates," "expects," "projects," "estimates," "believes," "seeks," "could," "should," or "continue," the negative thereof, and other variations or comparable terminology as well as statements regarding the evaluation of strategic alternatives and liquidation contingencies. These forward-looking statements are based on the current plans and expectations of management and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those reflected in such forward-looking statements. Such risks and uncertainties include, but are not limited to, risks and uncertainties relating to our efforts to enhance the values of our remaining properties and seek the orderly, strategic sale of such properties as soon as reasonably practicable, risks associated with the Article 78 proceeding against the Company and any other litigation that may develop in connection with our efforts to enhance the value of and sell our properties, ongoing community activism, risks associated with proxy contests and other actions of activist shareholders, risks related to the recent banking crisis and closure of two major banks (including one with whom we indirectly have a mortgage loan), regulatory enforcement, risks inherent in the real estate markets of Suffolk and Westchester Counties in New York, the ability to obtain additional capital in order to enhance the value of the Flowerfield and Cortlandt Manor properties and negotiate sales contracts and defend the Article 78 proceeding from a position of strength, the continuing effects of the COVID-19 pandemic, the ongoing risk of inflation, elevated interest rates, recession and supply chain constraints or disruptions and other risks detailed from time to time in the Company's SEC reports. These and other matters the Company discusses in this press release may cause actual results to differ from those the Company describes.
Additional Information and Where to Find It
The Company has filed the Registration Statement (including a prospectus) with the SEC for the offering to which this press release relates. Before you invest, you should read the prospectus in that registration statement and other documents the Company has filed with the SEC for more complete information about the Company and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov.
No Offer or Solicitation
This press release shall not constitute an offer, nor a solicitation of an offer, of the sale or purchase of securities, nor shall any securities of the Company be offered or sold in any jurisdiction in which such an offer, solicitation or sale would be unlawful. It is an outline of matters for discussion only. Neither the SEC nor any state securities commission has approved or disapproved of the transactions contemplated hereby or determined if this document is truthful or complete. Any representation to the contrary is a criminal offense. In connection with the Rights Offering transaction discussed herein, the Registration Statement was filed with the SEC on December 29, 2023. Shareholders of the Company are urged to read the Registration Statement and the documents incorporated by reference therein before making any investment decision with respect to the Rights Offering because they will contain important information regarding the proposed Rights Offering transaction. You should not construe the contents of this press release as legal, tax, accounting or investment advice or a recommendation. You should consult your own counsel and tax and financial advisors as to legal and related matters concerning the matters described herein.
FAQ
What is Gyrodyne, LLC's rights offering intended to raise?
What is the subscription price for Gyrodyne, LLC's common stock?
What are the intended uses of the net proceeds from the rights offering?
Until when are the subscription rights exercisable?
When was the registration statement declared effective by the SEC?
