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TORONTO - Venus Concept Inc. (NASDAQ:VERO), a medical aesthetic technology company with a market capitalization of $4.93 million and according to InvestingPro analysis, operating with a significant debt burden, exchanged $6.5 million of subordinated convertible notes held by Madryn Asset Management affiliates for 325,651 shares of Series Y preferred stock, the company announced Tuesday.
Following the June 30 transaction, Venus Concept’s total debt obligations decreased to approximately $34.3 million, representing a 14% reduction from the $39.7 million outstanding as of December 31, 2024. This debt restructuring comes as InvestingPro data shows the company maintaining a concerning debt-to-equity ratio of 17.05 and a current ratio of 1.28.
"We continue to optimize our capital structure with the completion of an additional debt exchange that reduces our overall debt balance," said Rajiv De Silva, Chief Executive Officer of Venus Concept. The company’s financial health score currently stands at ’WEAK’ according to InvestingPro analysis, which offers 12 additional key insights about the company’s financial position.
Avinash Amin, Managing Partner at Madryn Asset Management, stated the debt-to-equity exchange "builds on our relationship with Venus and enables the Company to continue through its transformation plan."
The transaction provides Venus Concept with financial flexibility as it works toward closing its previously announced divestiture of the Venus Hair business, according to the company’s press release statement.
Venus Concept develops and markets minimally invasive and non-invasive medical aesthetic and hair restoration technologies, with products available in over 60 countries. The company’s portfolio includes platforms such as Venus Versa, Venus Legacy, and the ARTAS iX Robotic Hair Restoration system. Despite maintaining a strong gross profit margin of 67.9%, the company has experienced a revenue decline of 16.79% over the last twelve months.
In other recent news, Venus Concept Inc. has announced several financial developments. The company completed a registered direct offering, raising approximately $1.57 million through the sale of 386,700 shares at $4.06 per share. Additionally, Venus Concept entered into another direct offering agreement to sell 434,720 shares at $2.65 each, with potential additional proceeds from unregistered short-term warrants. The gross proceeds from this offering are expected to be around $1.15 million. Furthermore, Venus Concept agreed to sell its Venus Hair division to Meta Healthcare Group for $20 million in cash, a move aimed at enhancing its balance sheet and focusing on core medical aesthetics. This transaction includes the transfer of ARTAS and NeoGraft technologies and is expected to close in the third quarter of 2025. H.C. Wainwright & Co. served as the exclusive placement agent for these financial transactions. These recent developments reflect Venus Concept’s ongoing efforts to optimize its financial strategy and support growth initiatives.
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