TELA Bio Announces Proposed Public Offering of Common Stock and Pre-Funded Warrants

Rhea-AI Summary

TELA Bio, a medical technology company focused on soft-tissue reconstruction, has announced a proposed public offering of common stock and pre-funded warrants. The offering includes an option for underwriters to purchase up to an additional 15% of securities. Canaccord Genuity and Lake Street Capital Markets are acting as joint bookrunners. TELA intends to use the net proceeds for general corporate purposes, including sales and marketing, research and development, administrative matters, working capital, and capital expenditures. The offering is being made pursuant to a shelf registration statement on Form S-3 that was declared effective by the SEC on November 20, 2023. A preliminary prospectus supplement and accompanying prospectus will be filed with the SEC.

Positive

• Potential to raise additional capital for corporate growth
• Funds to be used for sales, marketing, R&D, and working capital
• Offering made under an effective shelf registration statement

Negative

• Potential dilution of existing shareholders' ownership
• Uncertainty regarding the size and terms of the offering
• Market conditions may affect the completion of the offering

Insights

Financial Analyst

TELA Bio's proposed public offering of common stock and pre-funded warrants is a significant move to raise capital. This type of offering typically dilutes existing shareholders but provides necessary funds for growth and operations. The company's intent to use proceeds for general corporate purposes, including sales, marketing, R&D and working capital, suggests a focus on expansion and operational enhancement.

The involvement of Canaccord Genuity and Lake Street Capital Markets as joint bookrunners lends credibility to the offering. The 30-day option for underwriters to purchase additional securities is standard practice, potentially increasing the capital raised if exercised.

Investors should note that while this offering may provide TELA Bio with needed capital, it also signals potential cash flow challenges or ambitious growth plans requiring substantial investment. The market's reaction to this news will be crucial, as it may impact the stock price in the short term. Long-term implications depend on how effectively the company utilizes the raised capital to drive growth and improve financial performance.

Market Research Analyst

TELA Bio's decision to conduct a public offering reflects the current state of the medical technology market and the company's position within it. As a commercial-stage company in the soft-tissue reconstruction space, TELA is likely facing intense competition and the need for continuous innovation.

The offering of both common stock and pre-funded warrants provides flexibility to investors, which could enhance the attractiveness of the offering. This strategy may help TELA Bio to secure more capital by catering to different investor preferences.

The use of a shelf registration statement indicates that TELA Bio had anticipated the need for additional capital and prepared accordingly. This proactive approach suggests good foresight from management but also hints at the capital-intensive nature of their business model.

Investors should monitor how this capital raise impacts TELA Bio's market position and whether it translates into tangible growth or improved competitive advantage in the medical technology sector.

MALVERN, Pa., Oct. 22, 2024 (GLOBE NEWSWIRE) -- TELA Bio, Inc. ("TELA"), a commercial-stage medical technology company focused on providing innovative soft-tissue reconstruction, today announced that it has commenced an underwritten public offering of shares of its common stock and, in lieu of common stock to investors who so choose, pre-funded warrants to purchase shares of its common stock. In addition, TELA expects to grant the underwriters a 30-day option to purchase up to an additional 15% of the securities to be sold in the proposed offering at the public offering price for the common stock, less underwriting discounts and commissions. All shares of common stock and pre-funded warrants are being offered by TELA. The proposed offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or the actual size or terms of the proposed offering.

Canaccord Genuity and Lake Street Capital Markets are acting as joint bookrunners for the proposed offering.

TELA intends to use the net proceeds from the proposed offering for general corporate purposes, including but not limited to sales and marketing, research and development activities, general and administrative matters, working capital and capital expenditures.

The proposed offering is being made pursuant to a shelf registration statement on Form S-3 (File No. 333-275511) that was declared effective by the Securities and Exchange Commission (“SEC”) on November 20, 2023. A preliminary prospectus supplement and accompanying prospectus relating to the proposed offering will be filed with the SEC and will be available for free on the SEC’s website, located at www.sec.gov. Copies of the preliminary prospectus supplement and the accompanying prospectus relating to the proposed offering may be obtained, when available, from Canaccord Genuity LLC, Attention: Syndication Department, One Post Office Square, Suite 3000, Boston, Massachusetts 02109, or by telephone at (617) 371-3900, or by email at prospectus@cgf.com; or Lake Street Capital Markets, LLC, Attention: Syndicate Department, 920 Second Avenue South, Suite 700, Minneapolis, Minnesota 55402, or by telephone at (612) 326-1305, or by email at syndicate@lakestreetcm.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy these 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 prior to registration or qualification under the securities laws of that state or jurisdiction.

About TELA Bio, Inc.

TELA Bio, Inc. is a commercial-stage medical technology company focused on providing innovative technologies that optimize clinical outcomes by prioritizing the preservation and restoration of the patient's own anatomy. The Company is committed to providing surgeons with advanced, economically effective soft-tissue reconstruction solutions that leverage the patient's natural healing response while minimizing long-term exposure to permanent synthetic materials.

Caution Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Words such as "may," "might," "will," "should," "believe," "expect," "anticipate," "estimate," "continue," "predict," "forecast," "project," "plan," "intend" or similar expressions, or statements regarding intent, belief, or current expectations are forward-looking statements and reflect the current beliefs of TELA's management. Such forward-looking statements include, without limitation, statements relating to the completion, timing, size, and use of proceeds of the proposed public offering of common stock and pre-funded warrants. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors that could cause actual results and events to differ materially and adversely from those indicated by such forward-looking statements including, among others: risks and uncertainties related to market conditions and the satisfaction of customary closing conditions related to the proposed public offering, and other risks and uncertainties related to the proposed public offering, as well as the risks and uncertainties set forth in the "Risk Factors" section and elsewhere in the preliminary prospectus supplement related to the proposed public offering filed with the SEC and in our other filings with the SEC and available at www.sec.gov, including in our Annual Report on Form 10-K. Any forward-looking statements that we make in this announcement speak only as of the date of this press release, and TELA assumes no obligation to update forward-looking statements whether as a result of new information, future events or otherwise after the date of this press release, except as required under applicable law.

Investor Contact
Louisa Smith
ir@telabio.com

FAQ

What is the purpose of TELA Bio's proposed public offering?

TELA Bio's proposed public offering aims to raise capital for general corporate purposes, including sales and marketing, research and development activities, administrative matters, working capital, and capital expenditures.

Who are the underwriters for TELA Bio's (TELA) proposed offering?

Canaccord Genuity and Lake Street Capital Markets are acting as joint bookrunners for TELA Bio's proposed public offering.

What securities are being offered in TELA Bio's (TELA) public offering?

TELA Bio is offering shares of its common stock and, for investors who prefer, pre-funded warrants to purchase shares of its common stock.

When was TELA Bio's shelf registration statement declared effective by the SEC?

TELA Bio's shelf registration statement on Form S-3 (File No. 333-275511) was declared effective by the SEC on November 20, 2023.