Sequans To Raise $50M Via Private Institutional To Drive 5G, Broadband Business

• Sequans Communications SA (NYSE: SQNS) has raised $50 million in private financing from investment management firm Lynrock Lake LP affiliate Lynrock Lake Master Fund LP.

• The funding covers $10 million shares priced at $5.5 per share, signifying a 12.7% discount to the Apr. 6 closing price of $6.3 and $40 million of debt, convertible into shares at a conversion price of $7.66.

• The convertible debt will mature in three years and pay a yearly interest of 5.0625% for cash payments or 6% for Payment in Kind (PIK) accruals.

• Sequans retains an option to call the convertible debt after 12 months, subject to a 9.9% ownership limit for Lynrock Lake.

• The offering proceeds will be utilized to repay $11.7 million in convertible debt and accrued interest due on Apr. 14, 2021, and $7 million (€6 million) in euro-based debt. The remaining proceeds will be used for general corporate purposes.

• The funding will bolster the balance sheet to drive its 5G IoT and broadband IoT businesses and working capital for ongoing component management and supply chain dynamics.

• Sequans held $7.6 million in cash and cash equivalent as of Dec. 31, 2020.

• Price action: SQNS shares closed higher by 0.96% at $6.3 on Tuesday.

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