LANGHORNE, PA — NEXGEL, Inc. (NASDAQ: NXGL) has announced definitive agreements this week for the issuance and sale of 444,000 shares of common stock and warrants to purchase an additional 222,000 shares. The combined purchase price is set at $2.50 per share of common stock in a registered direct offering. The warrants, exercisable immediately, are priced at $4.25 per share and will remain valid for five years from the date of issuance.
The offering attracted participation from NEXGEL insiders, including key members of the management team and Board of Directors. These insiders are subject to a six-month lock-up period post-closing. The gross proceeds from this offering are anticipated to be approximately $1.11 million, before accounting for offering expenses.
NEXGEL’s CEO, Adam Levy, remarked on the development, stating, “After the strategic acquisition of international beauty brand, Silly George, and the immediate requirement for additional inventory and marketing to meet the higher than expected demand for its products, management and the Board agreed to provide additional working capital to the Company along with existing and new investors. We believe this capital will allow us to comfortably continue to operate the business and strengthens our balance sheet as we approach significant growth opportunities in the remainder of this year.”
The recent acquisition of Silly George marks a pivotal move for NEXGEL, positioning the company to capitalize on burgeoning demand in the beauty and personal care market. Silly George, known for its innovative beauty products, has already shown strong market traction. The funds raised from the direct offering will support inventory expansion and marketing efforts to sustain and accelerate this growth.
Alere Financial Partners, LLC, a division of Cova Capital Partners, LLC, acted as the exclusive placement agent for the offering. This move aligns with NEXGEL’s strategy to bolster its financial position and provide the necessary resources to scale operations efficiently.
The offering is made under the Company’s shelf registration statement on Form S-3 (File No. 333-264282), previously filed with the U.S. Securities and Exchange Commission (SEC) and declared effective on June 7, 2023. A prospectus supplement detailing the offering terms will be filed with the SEC and available on the SEC’s website.
This strategic financial maneuver is part of NEXGEL’s broader plan to secure its foothold in the competitive beauty and healthcare markets. The addition of Silly George to its portfolio not only diversifies its product offerings but also enhances its market reach. With the infusion of new capital, NEXGEL aims to leverage these assets to deliver robust growth and long-term shareholder value.
As NEXGEL moves forward, the focus will be on integrating Silly George’s operations, scaling up production, and intensifying marketing efforts to meet consumer demand. The company’s commitment to innovation and quality, coupled with strategic financial planning, positions it well to capture significant market share in the coming months.
The successful completion of this direct offering and the strategic acquisition accentuates NEXGEL’s proactive approach to business expansion and operational excellence. Investors and stakeholders can look forward to a period of dynamic growth and enhanced market presence as the company continues to execute its strategic initiatives.
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