LabStyle raises $8.5M in a public offering

MyDario

LabStyle Innovations, which has developed the Dario Diabetes Management Solution, announced approval to list its common stock and warrants on NASDAQ, effective March 4, 2016, and will trade under the symbols “DRIO” and “DRIOW”, respectively.

The company also announced the pricing of a firm commitment underwritten public offering of 1,333,333 shares of common stock and warrants to purchase up to 1,333,333 shares for an approximate aggregate gross amount of $6.0 million as well as a concurrent private placement of common stock and warrants for an approximate aggregate gross amount of $2.5 million (for a total of $8.5 million). Each share of common stock and warrant to purchase one share of common stock are offered at a combined price to the public of $4.51. The warrants will have an exercise price of $4.50, are exercisable immediately, and will have a term of five years.

LabStyle has granted the underwriters a 45-day option to purchase up to an additional 200,000 shares of common stock and/or warrants to purchase 200,000 shares of common stock to cover over-allotments, if any. The offering and private placement are expected to close on or about March 8, 2016, subject to customary closing conditions.

The company will use the funds to increase manufacturing capacity, further develop its software platform, expand sales and marketing efforts. Also, some of the money will go towards LabStyle’s working capital and general corporate purposes.

The company also effected a 1-for-18 reverse stock split of its issued and outstanding shares of common stock and the offering price reflects such stock split. The reverse split, before giving effect to the offering and private placement, reduces the number of LabStyle’s issued and outstanding shares of common stock from approximately 54 million to around 3 million. LabStyle’s common stock will trade under a new CUSIP number (50544T 302). The exercise price and the number of shares of common stock issuable under LabStyle’s outstanding warrants and options have been proportionately adjusted to reflect the reverse stock split. Fractional shares created as a result of the stock split will be rounded up to the next whole share.

Rodman & Renshaw, a unit of H.C. Wainwright & Co., and Joseph Gunnar & Co., LLC are acting as joint book-running managers for the offering.