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BEIJING - Origin Agritech Ltd. (NASDAQ:SEED), a Chinese agricultural technology company with a market capitalization of $8.23 million, announced Tuesday it has secured approximately $3.88 million in new investments through two separate agreements. According to InvestingPro data, the company has been facing significant financial challenges, with its stock down over 64% in the past year.
The company reported that CEO Weibin Yan has personally invested $2.4 million to acquire 2 million ordinary shares at $1.20 per share. Simultaneously, Origin modified an existing securities purchase agreement with institutional investors, consolidating remaining tranches into a single closing at $1.20 per share, which will provide an additional $1.48 million. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading below its intrinsic value, though investors should note the company’s weak financial health score of 1.25 out of 10.
"These strategic investments demonstrate the concrete confidence between Origin and our investors to adapt to evolving market conditions while maintaining our focus on long-term value creation," Yan said in a statement.
The company indicated the combined capital will support expansion in China’s agricultural biotechnology sector, including research and development capabilities, market penetration, and distribution networks.
Origin Agritech, founded in 1997 and headquartered in Beijing, focuses on crop seed biotechnologies. The company’s phytase corn was the first transgenic corn to receive a Bio-Safety Certificate from China’s Ministry of Agriculture, according to the press release statement.
The investment agreements follow an original securities purchase agreement executed in August 2024 with institutional investors, which has now been modified to adjust the terms and pricing structure.
In other recent news, Origin Agritech Limited has modified its share agreements, approving the sale of 1,234,300 ordinary shares at $1.20 each, totaling $1,481,250. This transaction is part of a revised securities sale agreement initially established in August 2024. Additionally, Origin Agritech has restructured its board, appointing two new independent directors, Dr. Changqing Mao and Mr. Siu Laam Hau, reducing the board size from seven to five members. Dr. Mao will serve as the Independent Director and Chairman of the Nomination Committee, while Mr. Hau will take on the role of Independent Director and Chairman of the Audit Committee. The company has also begun full-scale seed processing operations at its Xinjiang facility, utilizing a fully automated production line for corn seeds. This facility features advanced systems for cleaning, drying, threshing, sorting, coating, and packaging, along with real-time monitoring to ensure optimal seed quality. These developments highlight Origin Agritech’s ongoing efforts to streamline operations and strengthen its corporate governance.
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