Xcel Brands, Inc. Announces Proposed Public Offering of Common Stock
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Insights
When a company like Xcel Brands announces a public offering of its common stock, it's a pivotal moment that demands close scrutiny from a financial perspective. The primary purpose of such an offering is often to raise capital, which can be used for a variety of strategic moves such as debt repayment, funding new projects, or acquisitions. Investors should note that the market's reception to this offering could influence Xcel's stock price. If the offering is priced below current market levels, it might lead to a temporary dip in share value. Conversely, a well-received offering could bolster investor confidence and potentially drive up the share price.
Another aspect to consider is dilution. Current shareholders might experience a dilution of their ownership percentage, which can affect the value of their investment. However, the influx of capital could also lead to growth and increased market share, which may offset the dilution effect in the long run. The role of Craig-Hallum Capital Group as the sole managing underwriter is also significant. Their reputation and the terms they negotiate will play a crucial role in the success of the offering.
The timing and conditions of Xcel Brands' public offering are indicative of the company's market strategy and the confidence of its management in the brand's growth potential. The retail and consumer goods sector is highly competitive and Xcel's move to raise capital suggests an aggressive posture towards expansion or innovation. Prospective and current investors should look beyond the immediate effects of the offering and consider the company's long-term strategy.
Furthermore, the market's response to this offering will provide valuable insights into investor sentiment towards Xcel Brands. A successful offering could signify market approval of the company's direction, while a lackluster response might signal the need for a strategic reassessment. The details in the prospectus supplement will be crucial for investors, as they will outline the intended use of proceeds, which can greatly affect the company's future performance.
It's important to understand the legal framework governing Xcel Brands' public offering. The shelf registration statement, which has already been declared effective by the SEC, allows for the timely offering of securities, providing Xcel with the flexibility to tap into the market opportunistically. The legal stipulations that no sale can occur in any jurisdiction where it would be unlawful ensures compliance with varying state securities laws, which is a safeguard for both the company and investors.
Investors should pay attention to the prospectus and prospectus supplement, as these documents contain critical information about the risks, terms and conditions of the offering. Any discrepancies or omissions in these legal documents could have significant implications. Moreover, the legal language that 'this press release shall not constitute an offer to sell' is a standard disclaimer to prevent premature commitments before the full details of the offering are disclosed and understood.
NEW YORK, March 14, 2024 (GLOBE NEWSWIRE) -- Xcel Brands, Inc. (“Xcel”; NASDAQ: XELB), a media and consumer products company engaged in the design, licensing, marketing, live streaming and social commerce sales of branded apparel, footwear, accessories, fine jewelry, home goods and consumer products, and the acquisition of dynamic consumer lifestyle brands, today announced that it is commencing an underwritten public offering of shares of its common stock (or common stock equivalents). All of the shares of common stock (or common stock equivalents) are being offered by Xcel. The offering is subject to market conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.
Craig-Hallum Capital Group LLC is acting as the sole managing underwriter for the offering.
The securities are being offered pursuant to a shelf registration statement filed with the Securities and Exchange Commission (“SEC”) on January 26, 2024, and declared effective by the SEC on February 6, 2024. The offering of securities will be made only by means of the prospectus and prospectus supplement that forms a part of the registration statement. A preliminary prospectus supplement and accompanying prospectus relating to, and describing the terms of, the offering, will be filed with the SEC and will be available on the SEC's website at www.sec.gov. Copies of the preliminary prospectus supplement and accompanying prospectus relating to the offering, when available, may also be obtained by contacting Craig-Hallum Capital Group LLC, Attention: Equity Capital Markets, 222 South 9th Street, Suite 350, Minneapolis, Minnesota 55402, by telephone at (612) 334-6300, or by email at prospectus@chlm.com.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, 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 any such state or jurisdiction.
About Xcel Brands
Xcel Brands, Inc. (NASDAQ: XELB) is a media and consumer products company engaged in the design, marketing, live streaming, social commerce sales of branded apparel, footwear, accessories, fine jewelry, home goods and other consumer products, and the acquisition of dynamic consumer lifestyle brands. Xcel was founded in 2011 with a vision to reimagine shopping, entertainment, and social media as one thing. Xcel owns the Judith Ripka, Halston, LOGO by Lori Goldstein, and C. Wonder by Christian Siriano brands and a minority stake in the Isaac Mizrahi brand. It also owns and manages the Longaberger brand through its controlling interest in Longaberger Licensing LLC and a
Cautionary Statement Regarding Forward Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact contained in this press release, including statements regarding future events, our future financial performance, business strategy and plans and objectives of management for future operations, are forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “ongoing,” “could,” “estimates,” “expects,” “intends,” “may,” “appears,” “suggests,” “future,” “likely,” “goal,” “plans,” “potential,” “projects,” “predicts,” “seeks,” “should,” “would,” “guidance,” “confident” or “will” or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to, statements regarding our anticipated revenue, expenses, profitability, strategic plans and capital needs. These statements are based on information available to us on the date hereof and our current expectations, estimates and projections and are not guarantees of future performance. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors, including, without limitation, the risks discussed in the “Risk Factors” section and elsewhere in the Company’s Annual Report on form 10-K for the year ended December 31, 2022 and its other filings with the SEC, which may cause our or our industry’s actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time, and it is not possible for us to predict all risk factors, nor can we address the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statements. You should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.
Contact:
Dave Gentry, CEO
RedChip Companies Inc.
407-491-4498
XELB@redchip.com
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