Venus Concept Announces 1-for-11 Reverse Stock Split

Rhea-AI Summary

Venus Concept Inc. (NASDAQ: VERO) announced a 1-for-11 reverse stock split effective March 3, 2025, at 5:00 p.m. EST. Trading on the split-adjusted basis will begin March 4, 2025, on the Nasdaq Capital Market. The split was approved by stockholders on February 14, 2025, with an authorized ratio range of 1-for-5 to 1-for-16.

The primary goal is to increase the bid price to regain Nasdaq compliance. The company's CUSIP number will change to 92332W303, while maintaining the 'VERO' trading symbol. Every 11 shares will be automatically reclassified into one new share, with proportionate adjustments to warrants, convertible securities, and equity incentive plans. Stockholders entitled to fractional shares will receive rounded-up whole shares, with no cash payments for fractions.

Positive

• No cash required for fractional shares settlement
• Automatic position adjustment for stockholders
• Maintains Nasdaq listing potential

Negative

• Significant share consolidation (1-for-11 ratio)
• Indicates compliance issues with Nasdaq listing requirements
• No fundamental business value change

Insights

Financial Analyst

Venus Concept's announced 1-for-11 reverse stock split represents a critical attempt to maintain Nasdaq listing compliance rather than a sign of business improvement. With the current share price at $0.32, well below Nasdaq's $1.00 minimum bid requirement, this mechanical adjustment will mathematically increase the share price to approximately $3.52 post-split.

It's important to understand that reverse splits are typically viewed negatively by the market as they're often implemented by companies experiencing financial difficulties. While the split changes the share count and price, it does not alter the company's $3.9 million market capitalization or underlying business fundamentals. Shareholders will own fewer shares at a proportionally higher price, maintaining the same total investment value.

The history of reverse splits suggests concerning implications. Research indicates that companies implementing reverse splits to maintain listing requirements often underperform the broader market in subsequent periods. The reduced share count may also lead to decreased liquidity and potentially higher volatility.

For Venus Concept, this represents a temporary solution to a deeper problem. Without meaningful improvement in the company's medical aesthetic technology business performance and financial health, the stock price could resume its downward trajectory post-split, potentially facing delisting pressures again in the future. The company's extremely low market capitalization signals significant investor concerns about its long-term viability in the competitive medical aesthetics industry.

TORONTO, Feb. 27, 2025 (GLOBE NEWSWIRE) -- Venus Concept Inc. (“Venus Concept” or the “Company”) (NASDAQ: VERO), a global medical aesthetic technology leader, today announced that it will effect a 1-for-11 reverse stock split of the Company’s issued and outstanding common stock (the “Reverse Stock Split”). The Reverse Stock Split will be effective at 5:00 p.m. Eastern Standard Time on March 3, 2025. The Company’s common stock is expected to begin trading on The Nasdaq Capital Market on a split-adjusted basis at the open of trading on March 4, 2025.

The Company’s stockholders previously approved the Reverse Stock Split at a special meeting of stockholders held on February 14, 2025 at a ratio ranging from 1-for-5 up to a ratio of 1-for-16, such ratio and the implementation and timing of such Reverse Stock Split is to be determined by the Company’s Board of Directors at its discretion.

The principal purpose of the Reverse Stock Split is to increase the bid price of the Company’s common stock to regain compliance with the continued listing requirements of the Nasdaq Capital Market. In connection with the Reverse Stock Split, the Company’s CUSIP number has changed to 92332W303 as of 5:00 p.m. Eastern Standard Time on March 3, 2025. The Company’s common stock will continue to trade under the symbol “VERO.”

As a result of the Reverse Stock Split, every 11 shares of the Company’s common stock issued and outstanding will be automatically reclassified into one new share of common stock. The Reverse Stock Split will not modify any rights or preferences of the shares of the Company’s common stock. Proportionate adjustments will be made to the per share exercise price and the number of shares issuable upon the exercise or conversion of outstanding warrants, and convertible or exchangeable securities, as well as to the number of shares issued and issuable under the Company’s equity incentive plans. The conversion ratio of each class of the Company’s preferred stock will also be proportionately adjusted with respect to shares of preferred stock issued and outstanding before the Reverse Stock Split.

The common stock issued pursuant to the Reverse Stock Split will remain fully paid and non-assessable. The Reverse Stock Split will not affect the number of authorized shares of common stock or the par value of the common stock, nor will it change the authorized shares of Preferred Stock or the relative voting power of such holders of the Company’s outstanding common stock and Preferred Stock.

No fractional shares will be issued in connection with the Reverse Stock Split. Stockholders who would otherwise be entitled to receive fractional shares as a result of the Reverse Stock Split will automatically be entitled to receive an additional fraction of a share of common stock to round up to the next whole share. Cash will not be paid for fractional shares.

Computershare Inc. has been appointed by the Company to act as its exchange agent for the Reverse Stock Split. Stockholders owning pre-split shares via a bank, broker or other nominee will have their positions automatically adjusted to reflect the Reverse Stock Split and will not be required to take further action in connection with the Reverse Stock Split, subject to brokers’ particular processes. Similarly, registered stockholders holding pre-split shares of the Company's common stock electronically in book-entry form are also not required to take further action in connection with the Reverse Stock Split.

Additional information about the Reverse Stock Split can be found in the Company’s definitive proxy statement filed with the Securities and Exchange Commission (the “SEC”) on January 10, 2025, which is available free of charge at the SEC’s website, www.sec.gov/edgar, and on the Company’s website at ir.venusconcept.com.

Cautionary Statement Regarding Forward-Looking Statements

This communication contains “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. Any statements contained herein that are not of historical facts may be deemed to be forward-looking statements. In some cases, you can identify these statements by words such as such as “anticipates,” “believes,” “plans,” “expects,” “projects,” “future,” “intends,” “may,” “should,” “could,” “estimates,” “predicts,” “potential,” “continue,” “guidance,” and other similar expressions that are predictions of or indicate future events and future trends. These forward-looking statements include, but are not limited to, statements about the commencement of trading of our shares of common stock on a post-Reverse Stock Split basis, the bid price of our common stock following the Reverse Stock Split and our compliance with the continued listing requirements of the Nasdaq Capital Market, and involve risks and uncertainties that may cause results to differ materially from those set forth in the statements. These forward-looking statements are based on current expectations, estimates, forecasts, and projections about our business and the industry in which the Company operates and management's beliefs and assumptions and are not guarantees of future performance or developments and involve known and unknown risks, uncertainties, and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this communication may turn out to be inaccurate. Factors that could materially affect our business operations and financial performance and condition include, but are not limited to, those risks and uncertainties described under Part II Item 1A—“Risk Factors” in our Quarterly Reports on Form 10-Q and Part I Item 1A—“Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. You are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on the forward-looking statements. The forward-looking statements are based on information available to us as of the date of this communication. Unless required by law, the Company does not intend to publicly update or revise any forward-looking statements to reflect new information or future events or otherwise.

About Venus Concept

Venus Concept is an innovative global medical aesthetic technology leader with a broad product portfolio of minimally invasive and non-invasive medical aesthetic and hair restoration technologies and reach in over 60 countries and 10 direct markets. Venus Concept's product portfolio consists of aesthetic device platforms, including Venus Versa, Venus Versa Pro, Venus Legacy, Venus Velocity, Venus Viva, Venus Glow, Venus Bliss, Venus Bliss MAX, Venus Epileve, Venus Viva MD and AI.ME. Venus Concept's hair restoration systems include NeoGraft® and the ARTAS iX® Robotic Hair Restoration system. Venus Concept has been backed by leading healthcare industry growth equity investors, including EW Healthcare Partners (formerly Essex Woodlands), HealthQuest Capital, Longitude Capital Management and Aperture Venture Partners.

FAQ

When will Venus Concept's (VERO) 1-for-11 reverse stock split take effect?

The reverse stock split will take effect on March 3, 2025, at 5:00 p.m. EST, with split-adjusted trading beginning March 4, 2025.

What happens to fractional shares in Venus Concept's (VERO) reverse split?

Stockholders entitled to fractional shares will automatically receive an additional fraction to round up to the next whole share, with no cash payments.

Why is Venus Concept (VERO) implementing a reverse stock split?

The primary purpose is to increase the bid price of the company's common stock to regain compliance with Nasdaq Capital Market listing requirements.

How will the reverse split affect VERO stockholders' existing shares?

Every 11 shares will be automatically reclassified into one new share, with proportionate adjustments to warrants, convertible securities, and equity incentive plans.