HANGZHOU, China - China Jo-Jo Drugstores, Inc. (NASDAQ:CJJD), a prominent retail and wholesale distributor of pharmaceutical and healthcare products, announced today that it has secured definitive agreements with several investors for the sale of approximately 1.98 million ordinary shares. The shares are priced at $1.70 each, amounting to a total direct offering of roughly $3.37 million. The transaction is scheduled to close around June 26, 2024, contingent upon customary closing conditions.
The proceeds from the offering are earmarked for general corporate expenses and to boost working capital. This move comes as part of Jo-Jo Drugstores' strategy to strengthen its financial position and support its operations.
The offering of shares is made possible through a shelf registration statement on Form F-3, which was declared effective by the U.S. Securities and Exchange Commission (SEC) on December 19, 2022. The sale of these shares will be conducted via a prospectus, including a prospectus supplement that forms part of the registration statement.
Once filed with the SEC, details of the final prospectus supplement and the accompanying prospectus for this registered direct offering will be accessible on the SEC's website.
China Jo-Jo Drugstores operates both online and offline, providing healthcare services and distributing a range of healthcare products. The company also manages retail drugstores with on-site licensed doctors for consultations and treatments during scheduled hours.
This announcement does not constitute an offer to sell or a solicitation of an offer to buy the securities in any jurisdiction where such an offer, solicitation, or sale would be unlawful without registration or qualification under the securities laws of that jurisdiction.
The information in this article is based on a press release statement from China Jo-Jo Drugstores, Inc.
In other recent news, China Jo-Jo Drugstores has been active in the financial landscape. The company secured approximately $2.74 million in gross proceeds from a registered direct offering of ordinary shares. In another development, the company launched a direct offering aiming to raise around $1.53 million. Both offerings are part of the company's strategy to enhance its working capital and support general corporate purposes.
China Jo-Jo Drugstores also announced the resignation of board member Ms. Pingfan Wu, citing personal reasons. The company has not yet disclosed who will succeed Ms. Wu or how her responsibilities will be managed.
Furthermore, the company successfully regained compliance with the Nasdaq Capital Market's minimum bid price requirement, as confirmed by the Nasdaq Listing Qualifications Department. These are some of the recent developments at China Jo-Jo Drugstores.
InvestingPro Insights
Amid its recent capital-raising efforts, China Jo-Jo Drugstores, Inc. (NASDAQ:CJJD) has revealed a direct offering aimed at bolstering its financials and supporting its ongoing operations. Investors and stakeholders may find the following insights from InvestingPro valuable to understand the company's current financial health and market position.
InvestingPro data indicates that China Jo-Jo Drugstores is trading at a low Price / Book multiple of 0.44 as of the last twelve months leading up to Q2 2024, suggesting the market may be undervaluing the company's assets relative to its share price. Moreover, the company's market capitalization stands at a modest 8.24 million USD, reflecting a relatively small scale in the financial markets.
However, the company's financial performance poses some concerns, as highlighted by InvestingPro Tips. China Jo-Jo Drugstores is grappling with a significant debt burden, which may lead to difficulties in making interest payments. Moreover, the firm has been operating at a loss over the last twelve months, as evidenced by a negative P/E Ratio of -0.43 for the same period. The company's stock has also experienced substantial price volatility and a notable decline, with a 1 Year Price Total Return of -81.68%.
For investors interested in a deeper dive into the financial metrics and strategic outlook for China Jo-Jo Drugstores, there are additional InvestingPro Tips available at https://www.investing.com/pro/CJJD. These tips provide a comprehensive analysis that could be crucial for making informed investment decisions. To access these valuable insights, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
It's worth noting that the InvestingPro platform lists a total of 12 additional tips for China Jo-Jo Drugstores, offering a broader perspective on the company's financial stability, market performance, and potential investment risks or opportunities.
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