Sequans Communications introduced a $384 million fundraising initiative to create a Bitcoin treasury, topic to shareholder approval. The transfer comes as the corporate faces delisting dangers attributable to its market cap falling under NYSE necessities.
On June 23, Sequans Communications introduced plans to determine Bitcoin (BTC) treasury, marking a strategic growth past its core enterprise in 5G and 4G IoT semiconductors and modules. To fund this initiative, Sequans plans to lift roughly $384 million by way of personal placements, issuing round $195 million in fairness securities and $189 million in convertible secured debentures.
“We believe bitcoin’s unique characteristics will enhance our financial resilience and deliver significant value to our shareholders,” stated Georges Karam, CEO of Sequans.
The corporate plans to accomplice with Swan Bitcoin, a U.S.-based Bitcoin monetary providers agency, to implement the initiative.
In line with the announcement, shareholder approval is required by June 30 for the initiative to proceed. If the shareholders approve the providing on the June 30 assembly, Sequans expects to shut the fundraising spherical on or round July 1, topic to assembly all different customary circumstances.
The transfer comes as Sequans faces renewed stress from the New York Inventory Trade relating to its itemizing compliance. On June 5, the corporate acquired an official discover from the NYSE informing it that its common international market cap had fallen under the required $50 million threshold over a consecutive 30 trading-day interval, whereas its stockholders’ fairness additionally remained below $50 million. This twin deficiency triggered the formal discover of non-compliance below Part 802.01B of the NYSE Listed Firm Handbook.
Whereas this discover didn’t result in a direct delisting of Sequans’ American Depositary Shares (ADSs), it positioned the corporate on 90-day timeline to submit an in depth marketing strategy outlining the way it intends to regain compliance with the NYSE’s itemizing requirements inside 9 months. The NYSE will evaluation this plan and resolve inside 45 days whether or not the corporate’s proposed actions are affordable and achievable.
Throughout this nine-month “Market Cap Cure Period,” Sequans’ ADSs will stay listed and traded on the NYSE, supplied the corporate complies with different NYSE continued itemizing necessities.
The corporate has confirmed it’s actively exploring methods and making ready a plan to revive its market cap with a purpose to meet the alternate’s standards. The current initiative to lift funds for the Bitcoin treasury seems to be a part of the corporate’s efforts aimed toward boosting its market cap to regain compliance with NYSE itemizing necessities.