SAN FRANCISCO - Serve Robotics Inc. (Nasdaq: SERV), known for its autonomous delivery robots, has secured approximately $15 million through a private placement transaction with an institutional investor. The deal involves pre-funded warrants for purchasing 2.5 million shares of Serve's common stock, along with warrants to buy an equal number of shares at $6.00 each. This offering is slated to close on July 24, 2024, contingent on customary closing conditions.
The warrants, exercisable upon issuance, will expire five and a half years from the date of issuance. Aegis Capital Corp. is the exclusive placement agent for the offering, with Orrick, Herrington & Sutcliffe LLP and Sichenzia Ross Ference Carmel LLP providing legal counsel to Serve Robotics and Aegis Capital Corp., respectively.
Serve Robotics, which was spun off from Uber (NYSE:UBER) in 2021, has been at the forefront of developing AI-powered, low-emission sidewalk delivery robots. With backing from major industry players like Uber and NVIDIA (NASDAQ:NVDA), the company has successfully completed a significant number of deliveries through partnerships with Uber Eats and 7-Eleven.
The securities sold in this private placement are exempt from the registration requirements of the Securities Act of 1933, as amended, and have not been registered under the Act or any state securities laws. Consequently, they may not be offered or sold in the U.S. without registration or an applicable exemption from registration requirements. Serve Robotics has committed to filing registration statements with the SEC for the resale of the common stock shares sold and issuable upon the exercise of the pre-funded warrants and warrants involved in the private placement.
This financial move by Serve Robotics is based on a press release statement and is expected to bolster the company’s capacity to expand its market reach and enhance its technological offerings in the field of autonomous delivery services.
Recently, Serve Robotics Inc. has made significant strides in its growth strategy. The company has expanded its delivery operations into Koreatown, Los Angeles, in line with its strategy to extend its services across the U.S. Concurrently, Serve has enhanced its robotic fleet's sensors through an augmented lidar supply agreement with Ouster, Inc. These developments are part of Serve's plan to deploy up to 2,000 robots by 2025.
Serve has also solidified its partnership with Magna International (NYSE:MGA), allowing the company to expand its robot fleet for Uber Eats and other U.S. markets. This collaboration includes an exclusive contract manufacturing agreement, marking a crucial step in Serve's deployment plans.
InvestingPro Insights
As Serve Robotics Inc. (Nasdaq: SERV) navigates through its recent $15 million private placement, investors are keenly observing the company's financial health and market potential. According to InvestingPro data, the company's market capitalization stands at a modest $322.51 million, reflecting its niche position in the autonomous delivery sector. Although Serve Robotics has experienced a staggering revenue growth of over 742% in the last twelve months as of Q1 2024, it's important to note that the company has been operating at a loss, with an operating income margin of -2041.54% and a gross profit margin of -53.99% during the same period.
InvestingPro Tips suggest that analysts are optimistic about Serve's sales growth in the current year, which may align with the company's expansion plans and technological advancements. However, the stock is currently in overbought territory based on the Relative Strength Index (RSI), indicating that it might be due for a correction. On the performance front, Serve Robotics has seen a significant return over the last week, with a 268.49% increase in price total return, showcasing a potentially volatile yet rewarding investment for those who can time their market moves effectively.
For investors seeking a comprehensive analysis of Serve Robotics, InvestingPro offers additional insights, including 14 more InvestingPro Tips that could help in making informed decisions. To delve deeper into these valuable tips, visit Investing.com/pro/SERV. Don't miss out on the chance to enhance your investment strategy with InvestingPro, and use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.