Regeneration Technologies, Inc. Seeks to do $24 Million PIPE
BY JOHN MCCORMICK, AUGUST 26, 2005
Allograft and tissue processing stalwart Regeneration Technologies, Inc. (Nasdaq: RTIX - News), announced Thursday that it entered into definitive agreements to undertake a private placement of its common stock with a group of accredited investors (institutional firms or wealthy individuals). Commonly known as a "PIPE" (private investment in a public equity), the Company plans on raising $23.9 million by selling 2.8 million common shares at $8.55 a share - slightly more than a 10% discount to Wednesday's closing price.
The proceeds from the financing will be used for general working capital purposes.
This news comes on the heels of Regeneration Technologies withdrawing from a process to "seek strategic alternatives" back in May. In our view, this looks like a helpful move for the Company which has known to be whipsawed by Medtronic's (key customer) demand for tissue. A solid cash balance can help mitigate working capital swings.
