PLANO, Texas - Stryve Foods, Inc. (NASDAQ: SNAX), a company specializing in air-dried meat snacks, has announced a public offering of shares and warrants, set to close around November 12, 2024. The offering includes 3,670,886 shares of its Class A common stock and common stock equivalents, along with warrants to purchase up to 7,341,722 shares, at a combined price of $0.79 per share and associated warrant.
Each share or prefunded warrant is bundled with two warrants to purchase one share of Class A common stock. These warrants, priced at $0.79 each, will become exercisable following stockholder approval and remain valid for five years thereafter.
In conjunction with the offering, Stryve has also agreed to amend existing warrants for purchasing up to 529,412 shares by reducing the exercise price from $54.00 to $0.79 per share, pending stockholder approval.
Roth Capital Partners (WA:CPAP) and Northland Capital Markets are serving as co-placement agents for the offering. The company anticipates gross proceeds of approximately $2.9 million, before agent fees and other expenses are deducted. The net proceeds are intended for working capital and general corporate purposes.
This offering follows the effectiveness of Stryve's registration statement on Form S-1, filed with the SEC on September 11, 2024, and which became effective on the date of the press release, November 8, 2024.
Stryve, known for its brands such as Braaitime®, Kalahari®, Stryve®, and Vacadillos®, positions itself as a healthy snacking option, offering products that are low in sugar and carbohydrates, high in protein, and compatible with Keto and Paleo diets. Their portfolio includes air-dried meat snacks and human-grade pet treats sold through various retail channels and online platforms.
The information provided is based on a press release statement from Stryve Foods, Inc.
In other recent news, Stryve Foods has been making significant strides in its operations and financial growth. The company recently announced a strategic partnership with Dot Foods, North America's largest food industry redistributor, aiming to enhance Stryve's operational efficiencies and expand its distribution footprint. Furthermore, Stryve Foods has secured new retail distribution with a leading national retailer, introducing Stryve's products to thousands of new retail locations across the United States.
In addition to these developments, Stryve Foods has issued unsecured promissory notes totaling $761,422 at an annual interest rate of 15% to support inventory growth and general operations. The company has also finalized new contracts with CEO Christopher Boever and CFO R. Alex Hawkins (NASDAQ:HWKN), while Gregory S. Christenson resigned as a director and Chairman of the Audit Committee.
On the financial front, Stryve Foods reported a significant increase in gross margin to 27.4% and a modest 3% rise in net sales to $6.2 million in its second quarter of fiscal year 2024 earnings call. Despite a net loss of $3 million, the company expects to achieve net sales between $23 million and $26 million for the fiscal year 2024.
Lastly, Stryve Foods is exploring growth opportunities in the air-dried pet treat market and plans to enhance its digital presence with a website redesign in the fourth quarter of 2024. The company has also secured Kosher and Halal certifications to broaden its market reach. These recent developments reflect Stryve Foods' continued efforts to bolster its financial stability and market position.
InvestingPro Insights
Stryve Foods' recent public offering comes at a challenging time for the company, as revealed by InvestingPro data. The company's market capitalization stands at a modest $2.32 million, reflecting its current struggles. This aligns with several InvestingPro Tips that highlight the company's financial difficulties.
One of the most pressing issues for Stryve Foods is its debt burden. An InvestingPro Tip indicates that the company "Operates with a significant debt burden" and "May have trouble making interest payments on debt." This context sheds light on why the company is seeking additional capital through the public offering.
The company's financial health is further strained by its profitability issues. InvestingPro data shows that Stryve Foods has a negative P/E ratio of -0.14 for the last twelve months as of Q2 2024, indicating that the company is not profitable. This is corroborated by an InvestingPro Tip stating that the company is "Not profitable over the last twelve months."
Despite these challenges, there is a glimmer of hope. An InvestingPro Tip suggests that "Analysts anticipate sales growth in the current year." This potential growth could be crucial for Stryve Foods as it seeks to improve its financial position.
For investors considering Stryve Foods, it's worth noting that InvestingPro offers 18 additional tips for SNAX, providing a more comprehensive analysis of the company's situation. These insights could be valuable for understanding the full picture of Stryve Foods' financial health and market position.
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