SANW : Swapping convert. debt for straight equity saves interest expense.
NASDAQ:SANW S&W Seed (SANW) has announced it has closed a private placement of 1.180722 million shares for about $4.9 million with a private investment fund controlled by a member of its board and existing large shareholder, Michael F. Price. The company expects to use the proceeds to pay down part of the 8% Convertible Debentures, of which there was $9.6 million outstanding as of the end of the first fiscal quarter. This would save about $.02 a share a quarter in reduced interest expense. The company also intends to distribute a rights offering in early 2016. This will give existing shareholders the right to buy equity at $4.15 a share and is expected to raise $10.4 million. This equates to an additional 2.5 million shares if there is full participation. READ THE LATEST FULL RESEARCH REPORT HERE SUBSCRIBE TO ZACKS SMALL CAP RESEARCH to receive our articles and reports emailed directly to you each morning. Please visit our website for additional information on Zacks SCR and to view our disclaimer.
