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SHENZHEN - Fangdd Network Group Ltd . (NASDAQ:DUO), a property technology firm based in China, has finalized a securities purchase agreement for a $5 million offering of convertible promissory notes and Class A ordinary shares. The transaction includes senior 5% original issue discount convertible promissory notes and an additional 164,610 Class A ordinary shares. According to InvestingPro data, the company has been quickly burning through cash, with revenue of $37.35 million in the last twelve months.
The notes, issued at a 5% original issue discount, have a nine-month maturity with no interest accruing unless default occurs, which would then trigger a 15% annual interest rate. These obligations are senior to all of FangDD’s existing debt and equity. While the company maintains a current ratio of 1.17, InvestingPro analysis reveals concerning metrics, including weak gross profit margins of 14.3% and significant stock price volatility.
Investors can convert the notes into shares at a price determined by the lower of two calculations based on the company’s volume-weighted average price (VWAP), with a floor price set at $0.11 per share. If the conversion price falls below the floor, the company will compensate the note holder for the difference.
The offering, which is expected to close today, is part of a shelf registration statement filed and declared effective by the SEC in September 2022. MM Global Securities, Inc. is the exclusive placement agent for this offering. FangDD aims to use the net proceeds for general corporate purposes.
FangDD, which specializes in digitalizing real estate transactions through mobile internet, cloud, big data, and AI technologies, offers a suite of products and solutions for real estate transaction participants. The company’s shares have declined by 80.4% over the past six months, reflecting significant market challenges. Discover more comprehensive insights and 12 additional key indicators with InvestingPro’s exclusive analysis tools.
This press release is based on a statement from FangDD and should not be construed as an offer to sell or a solicitation of an offer to buy any securities.
In other recent news, Fangdd Network Group Ltd., a China-based property technology company, is facing potential delisting from Nasdaq due to a failure to meet the minimum bid price requirement. Notably, the company’s share price has remained under $1 for 30 consecutive business days, prompting a notification from Nasdaq. Fangdd has been given a 180-day period, ending June 23, 2025, to regain compliance by ensuring the closing bid price of its Class A ordinary shares reaches at least $1 for a minimum of ten consecutive business days.
The company may be eligible for an additional 180-day compliance period if all other initial listing standards for The Nasdaq Capital Market are met, excluding the bid price requirement. However, Fangdd must notify Nasdaq of its intention to remedy the deficiency during the second compliance period.
Despite this challenge, the current notification from Nasdaq does not affect the listing or trading of Fangdd’s Class A ordinary shares on the market. Fangdd has expressed its intention to closely monitor its share price and is exploring options to address the deficiency and regain compliance with the Nasdaq Listing Rule. These are the recent developments surrounding Fangdd Network Group Ltd.
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