Intelligent Bio Solutions Inc. Announces Reverse Stock Split

Rhea-AI Summary

Intelligent Bio Solutions Inc. (INBS) has announced a 1-for-12 reverse split of its common stock, effective on January 26, 2024. The split is aimed at increasing the per-share trading price and ensuring compliance with Nasdaq’s listing requirements. The reverse split will result in every 12 shares being combined into one share, with adjustments to outstanding equity-based awards and other equity rights. The split will not affect the par value of the common stock or the number of authorized shares, leaving the company with approximately 1,494,223 shares of common stock issued and outstanding.

Insights

Financial Analyst

A reverse stock split is a corporate action where a company reduces the number of its outstanding shares to increase the market value of each share. The 1-for-12 reverse split by Intelligent Bio Solutions Inc. is a strategic move to comply with the Nasdaq's minimum share price requirement, which is a common reason for such actions. The immediate effect on the market could be a perception of increased value per share, which might attract investors looking for stocks with higher price points.

However, it is critical to note that a reverse split does not intrinsically change the company's market capitalization or value. The adjustment to equity-based awards and warrants will maintain the equivalent value pre-split, though the number of shares or warrants will decrease proportionally. Investors should monitor the stock's performance post-split to gauge market sentiment, as sometimes reverse splits can be viewed negatively, signaling that a company is struggling to meet listing requirements.

Long-term implications for stakeholders will depend on the company's subsequent performance and ability to leverage the reverse split to maintain compliance and possibly attract institutional investors. However, it is essential to consider that without fundamental improvements in the company's operations, financial health, or growth prospects, the benefits of a reverse split may be limited.

Market Research Analyst

The biotech sector, where Intelligent Bio Solutions Inc. operates, is highly sensitive to regulatory compliance and market perception. The reverse stock split might be perceived as a tactical maneuver to stabilize the company's standing on the Nasdaq. While this move does not impact the firm's operational capacity, it could influence investor confidence and the company's reputation.

It is also noteworthy that the reverse stock split will not affect stockholders' percentage interests, except for the rounding up of fractional shares. This is a neutral action for most investors but could be marginally beneficial for those who receive a rounded-up share. The decision to not issue fractional shares and instead round up to the nearest whole number is a shareholder-friendly move that could foster goodwill.

The stock's liquidity post-split will be a key factor to watch, as reduced share counts can sometimes lead to lower trading volumes and higher volatility. Stakeholders should also be aware of the potential psychological impact of the reverse split on market perception, as a higher per-share price might be mistakenly interpreted as a sign of a healthier company.

Legal Expert

The reverse stock split has been executed following shareholder approval, which is a mandatory legal procedure to ensure that such significant decisions are made transparently and with shareholder consent. This reflects the company's adherence to corporate governance standards.

From a legal standpoint, the adjustments to the equity-based awards and other equity rights are significant. They ensure that the interests of employees, management and warrant holders are preserved post-split. The legal implications of not issuing fractional shares but rounding up instead are minimal and are generally accepted as standard practice in reverse stock splits. This move also avoids the administrative burden and potential legal complexities associated with the distribution of fractional shares.

Finally, the par value remaining unchanged is a standard legal outcome of a reverse stock split and it indicates no alteration to the company's charter in terms of stock value. The number of authorized shares remaining the same suggests that the company is not seeking to reduce its potential for future equity raises, which could be an important consideration for stakeholders evaluating long-term strategy.

NEW YORK, Jan. 25, 2024 (GLOBE NEWSWIRE) -- Intelligent Bio Solutions Inc. (Nasdaq: INBS) (“Intelligent Bio Solutions” or the “Company”), a medical technology company delivering intelligent, rapid, non-invasive testing solutions, today announced that it will effect a 1-for-12 reverse split of its common stock, that will become effective at 5:00 pm (Eastern Time) on January 26, 2024. Trading of the Company's common stock on The Nasdaq Capital Market (“Nasdaq”) will continue, on a split-adjusted basis, with the opening of the markets on January 29, 2024, under the trading symbol “INBS” and new CUSIP number 36151G600.

The reverse stock split was approved by Intelligent Bio Solutions’ stockholders at the annual meeting of the Company’s stockholders held on December 13, 2023, with the final ratio to be determined by the Company’s Board of Directors within the ratio range authorized by shareholders. The reverse stock split is primarily intended to increase the Company’s per share trading price and bring the Company into compliance with Nasdaq’s listing requirement regarding minimum share price.

As a result of the reverse stock split, every 12 shares of common stock issued and outstanding as of the effective date will be automatically combined into one share of common stock. In addition, a proportionate adjustment will be made to outstanding equity-based awards and other equity rights, including warrants. No fractional shares will be issued as a result of the reverse stock split. Stockholders of record who would otherwise be entitled to receive a fractional share will be entitled to the rounding up of the fractional share to the nearest whole number. The par value of the common stock will remain unchanged at $0.01 per share after the reverse split, and the number of authorized shares of common stock will remain at 100 million shares. Immediately after the reverse stock split becomes effective, the Company will have approximately 1,494,223 shares of common stock issued and outstanding. The reverse split affects all stockholders uniformly and will not alter any stockholder’s percentage interest in the Company’s equity, except to the extent that the reverse split results in some stockholders owning a fractional share as described above.

About Intelligent Bio Solutions Inc.

Intelligent Bio Solutions Inc. (NASDAQ: INBS) is a medical technology company delivering innovative, rapid, non-invasive testing solutions. The Company believes that its Intelligent Fingerprinting Drug Screening System will revolutionize portable testing through fingerprint sweat analysis, which has the potential for broader applications in additional fields. Designed as a hygienic and cost-effective system, the test screens for recent use of drugs commonly found in the workplace, including opiates, cocaine, methamphetamine, and cannabis. With sample collection in seconds and results in under ten minutes, this technology would be a valuable tool for employers in safety-critical industries. Additionally, the Company's biosensor platform has the potential to test for up to 130 indications, ranging from glucose to immunological conditions and communicable diseases. The Company's current customer segments include construction, manufacturing and engineering, transport and logistics firms, drug treatment organizations, and coroners.

For more information, visit: https://ibs.inc/

Forward-Looking Statements:

Some of the statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. Forward-looking statements in this press release include, without limitation, Intelligent Bio Solutions Inc.'s ability to successfully develop and commercialize its drug and diagnostic tests, realize commercial benefit from its partnerships and collaborations, and secure regulatory approvals. Although Intelligent Bio Solutions Inc. believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. Intelligent Bio Solutions Inc. has attempted to identify forward-looking statements by terminology, including “believes,” “estimates,” “anticipates,” “expects,” “plans,” “projects,” “intends,” “potential,” “may,” “could,” “might,” “will,” “should,” “approximately” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors, included in Intelligent Bio Solutions' public filings filed with the Securities and Exchange Commission. Any forward-looking statements contained in this release speak only as of its date. Intelligent Bio Solutions undertakes no obligation to update any forward-looking statements contained in this release to reflect events or circumstances occurring after its date or to reflect the occurrence of unanticipated events.

Company Contact: 
Intelligent Bio Solutions Inc. 
info@ibs.inc 
LinkedIn | Twitter

Media Contact: 
Cheryl Billson 
Comma Communications 
cheryl.billson@commacomms.com

FAQ

What is the reverse split ratio announced by Intelligent Bio Solutions Inc. (INBS)?

Intelligent Bio Solutions Inc. (INBS) has announced a 1-for-12 reverse split of its common stock.

When will the reverse split of Intelligent Bio Solutions Inc. (INBS) common stock become effective?

The reverse split of Intelligent Bio Solutions Inc. (INBS) common stock will become effective at 5:00 pm (Eastern Time) on January 26, 2024.

What is the purpose of the reverse stock split announced by Intelligent Bio Solutions Inc. (INBS)?

The reverse stock split is primarily intended to increase the Company’s per share trading price and bring the Company into compliance with Nasdaq’s listing requirement regarding minimum share price.

How many shares of common stock will Intelligent Bio Solutions Inc. (INBS) have after the reverse split?

Immediately after the reverse stock split becomes effective, the Company will have approximately 1,494,223 shares of common stock issued and outstanding.