MultiSensor AI Holdings, Inc. Announces Closing of $10 Million Public Offering, Exercise of $1.5 Million Over-Allotment Option, Concurrent $15 Million Private Placement And Appointment of Daniel M. Friedberg to the Board of Directors
MultiSensor AI Holdings, a leader in AI-based industrial maintenance and process control solutions, announced the closing of a $10 million public offering, an exercised over-allotment option worth $1.5 million, and a concurrent $15 million private placement. The public offering included 6,250,000 shares at $1.60 each and an additional 937,500 shares under the over-allotment option. Gross proceeds from the public offering totaled $11.5 million before deductions. The company plans to use these proceeds for working capital and general purposes.
Roth Capital Partners managed the public offering, with Sanders Morris as co-manager. The private offering involved 2,772,561 shares and pre-funded warrants for 6,602,439 shares, totaling $15 million before deductions. The funds will also be used for working capital and general purposes. Roth Capital acted as the sole placement agent for the private offering.
Additionally, MultiSensor AI appointed Daniel M. Friedberg to its Board of Directors, also adding him to various committees.
- Closed $10 million public offering plus $1.5 million over-allotment option.
- Concurrent private placement raised $15 million.
- Funds will increase capitalization and financial flexibility.
- Daniel M. Friedberg appointed to the Board, enhancing governance.
- Dilution risk due to new share issuance in public and private offerings.
- Potential shareholder approval hurdle for pre-funded warrants.
Insights
MultiSensor AI Holdings, Inc. (MSAI) has successfully raised
Net proceeds from both offerings are earmarked for working capital and general corporate purposes, suggesting that the company is focusing on sustaining and expanding its operations. This move could provide the company with the liquidity needed to pursue growth initiatives without relying on debt financing, thereby improving its financial health.
Retail investors should be mindful that while the increase in capitalization and financial flexibility is advantageous, the issuance of new shares dilutes existing shareholders' equity. However, if the proceeds are utilized efficiently, the potential for enhanced operational performance could offset the dilution in the long run.
Overall, the financial maneuver strengthens MSAI’s balance sheet and provides a buffer against market uncertainties. Investors should keep an eye on how effectively the company deploys these funds in upcoming quarters.
From a market perspective, MSAI's dual approach of a public and private offering demonstrates a strategic effort to leverage different investor bases. The involvement of Roth Capital Partners as the sole book-running manager for the public offering and 325 Capital for the private placement broadens the scope of investor interest and fosters a diversified shareholder base.
The private placement's inclusion of pre-funded warrants, which are not exercisable without shareholder approval, indicates a cautious approach toward further share dilution, aligning with shareholder interests. This also suggests confidence from institutional investors like 325 Capital in the company's future prospects.
For retail investors, the structured financing indicates a strong backing from institutional players, which can be a positive indicator. It’s important to recognize that such structured deals often come with strategic support and validation from experienced investors, potentially opening doors for future collaborations or partnerships.
Investors should also note that improved trading volume, as hoped by the company, can enhance liquidity and potentially reduce volatility, making the stock more attractive for both retail and institutional investors.
The appointment of Daniel M. Friedberg to the Board of Directors, along with his inclusion in the compensation and nominating and corporate governance committees, as well as a newly created finance committee, is a noteworthy development. His extensive experience can provide valuable insights into corporate governance and financial oversight, potentially strengthening the company's governance structure.
For shareholders, the expansion of the board signifies an intent to enhance governance and possibly prepare for more complex financial and strategic decisions. The creation of a finance committee suggests a greater focus on financial planning and oversight, which can be pivotal as the company navigates its expanded capital structure.
While the appointment alone does not have immediate financial implications, it underscores the company's commitment to robust governance practices, which can be a reassuring factor for investors seeking long-term value.
BEAUMONT, TX / ACCESSWIRE / July 1, 2024 / MultiSensor AI Holdings, Inc. (Nasdaq:MSAI) ("MSAI" or the "Company"), a pioneer in AI-powered industrial condition-based maintenance and process control solutions, today announced the closing of a firm commitment public offering of 6,250,000 shares of its common stock at a public offering price of
The Company intends to use the net proceeds from the public offering for working capital and general corporate purposes. The primary purpose of the offering is to increase the Company's capitalization and financial flexibility, and to enhance the trading volume for the Company's common stock.
A registration statement on Form S-1 relating to the common stock sold in this offering was declared effective by the Securities and Exchange Commission (the "SEC") on June 27, 2024. The offering was made only by means of a prospectus. Copies of the final prospectus may be obtained on the SEC's website, www.sec.gov, or by contacting Roth Capital Partners, Attention: Equity Capital Markets, 888 San Clemente Drive, Suite 400, Newport Beach, CA 92660, or by telephone at 949-720-5700.
Roth Capital Partners acted as the sole book-running manager and Sanders Morris LLC acted as co-manager of the public offering.
Concurrent with the closing of the public offering, the Company closed the private offering and sale of 2,772,561 shares of its common stock at an offering price of
The Company intends to use the net proceeds from the private offering for working capital and general corporate purposes.
Roth Capital Partners, LLC ("Roth") acted as the sole placement agent of the private offering.
ArentFox Schiff LLP served as counsel to the Company in connection with the public and private offerings. Stradling Yocca Carlson & Rauth LLP served as counsel to the underwriters in connection with the public offering and to Roth in connection with the private offering. Olshan Frome Wolosky LLP served as counsel to 325 Capital.
In connection with the closing of the private offering and in accordance with the terms of the securities purchase agreement between the Company and 325 Capital relating to the offering, the Board of Directors of the Company (the "Board") unanimously voted to increase the size of the Board from six to seven directors, and to appoint Mr. Daniel M. Friedberg to fill the newly created Board position, to serve until his successor shall have been duly elected and qualified or until his earlier death, resignation or removal. In addition, the Board appointed Mr. Friedberg to each of its compensation and nominating and corporate governance committees, as well as the Board's newly created finance committee.
The Company welcomes Mr. Friedberg to the Board.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful.
About MultiSensor AI Holdings, Inc.
MultiSensor AI provides turnkey condition-based maintenance and process control solutions, which combine cutting edge imaging and sensing technologies with AI-powered enterprise software. Powered by AWS, MSAI's software leverages a continuous stream of data from thermal imaging, visible imaging, acoustic imaging, vibration sensing, and laser sensing devices to provide comprehensive, real-time condition monitoring for a customer's critical assets, processes, and manufactured outputs. This full-stack solution measures heat, vision, vibration, and gas in the surrounding environment, helping companies gain predictive insights to better manage their asset reliability and manufacturing processes. MSAI Cloud and MSAI Edge software solutions are deployed by customers to protect critical assets across a wide range of industries including distribution & logistics, manufacturing, utilities, and oil & gas.
For more information, please visit https://www.multisensorai.com.
About 325 Capital LLC
325 Capital is a long-term, significant, minority owner of high-quality, small, public companies. 325 Capital strives to constructively partner with management teams and boards that are committed to driving long-term, fundamental value. As lead shareholders, 325 Capital supports its portfolio by working from deeply researched facts, acting as discrete advisors or constructive board members, providing access to a network of relationships, and providing direct growth capital. The team at 325 Capital has worked together for more than 20 years developing this approach, strategy, and process and values facts, transparency, alignment, and partnership.
Forward Looking Statements
Some of the statements in this release are forward-looking statements, which involve risks and uncertainties. Forward-looking statements in this press release relate to, among other things, the intended use of proceeds from the public and private offerings. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, actual results may materially different from the results expressed or implied by such forward-looking statements. The Company 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. Any forward-looking statements contained in this release speak only as of its date. The Company 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. More detailed information about the risks and uncertainties affecting the Company is contained under the heading "Risk Factors" in the Company's Registration Statement on Form S-1 filed with the SEC, which is available on the SEC's website, www.sec.gov.
Media Contact
MultiSensor AI Holdings, Inc.
Andrew Klobucar
Director of Marketing
andrew.klobucar@multisensorai.com
Investor Contact
Alpha IR Group
Mike Cummings or Griffin Morris
MSAI@alpha-ir.com
SOURCE: MultiSensor AI Holdings, Inc.
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