<article><p>Singapore-based online luxury e-commerce platform and Nasdaq-listed Reebonz Holding Limited has submitted an amended SEC filing to include a warrant offering to purchase $25 million of the company’s ordinary shares.</article>

<p>Singapore-based online luxury e-commerce platform and Nasdaq-listed Reebonz Holding Limited has submitted an amended SEC filing to include a warrant offering to purchase $25 million of the company’s ordinary shares.</p>
<p>The additional warrant offering will add to the company&#8217;s ongoing $20-million ordinary share offering.</p>
<p>The pricing details, including the exercise price of the warrants, and timing details of the combined offering, are not finalised yet.</p>
<p>The amended filing disclosed that the warrants are exercisable at a per share exercise price equal to 125 per cent of the public offering per ordinary share valued at $20 million and it will expire on the fifth year of the original issuance date.</p>
<p>Assuming the warrants are fully taken up, including the additional $3.75 million if the underwriters (Roth Capital Partners and Maxim Group LLC) exercise their option to purchase additional ordinary shares and/or warrants, investors could see the potential dollar amount of ordinary shares issuable upon exercise of the warrants is about $28.75 million.</p>
<p>The following table illustrates the potential dollar amount of ordinary shares to be issued if both ordinary share and warrants are fully subscribed, including the underwriters exercise their options to participate in both offerings jointly. These calculations exclude underwriting expenses associated with the offering.</p>
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	<th class="column-1">Assume full take-up of ordinary shares plus underwriters exercising option to purchase additional US$3.0 million additional shares (US$)</th><th class="column-2"> 23,000,000 </th>
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	<td class="column-1">Assume full exercise of warrants with underwriters exercising option to purchase additional US$3.75 million additional shares (US$)</td><td class="column-2"> 28,750,000 </td>
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	<td class="column-1">Total $ amount of ordinary shares (Fully exercised warrants, and ordinary share offering) (US$)</td><td class="column-2"> 51,750,000 </td>
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<p>Source: Company’s SEC filings</p>
<p><strong>The rationale behind the fresh offering</strong></p>
<p>Since its Nasdaq debut in December 2018, and the official notification received from the Exchange regarding its shortfalls in meeting the listing requirements, the Reebonz management has been scrambling to meet several deadlines over the past few months including the latest deadline on March 31, 2019, where it was asked to fulfil the following listing requirements:</p>
<ul>
<li>Have $75 million of total assets and total revenue.</li>
<li>Have at least 1.1 million publicly held shares.</li>
<li>A public float of at least $20 million.</li>
<li>A minimum bid of $4 per share, and 400 round lot shareholders.</li>
</ul>
<p>In its annual filing on April 01, 2019, Reebonz disclosed that it has met the first two listing requirements of having achieved $75 million in total assets and revenue (FY 2018 actual total assets and revenue are $79.14 million, and $88.38 million respectively) as at year ended December 31, 2018.</p>
<p>However, Reebonz needs to complete the rest of the listing requirements in order to remain compliant.</p>
<p>On February 27, 2019, the company’s warrants were delisted from the Nasdaq Exchange after it had failed to fulfil the listing requirement of having at least 400 round lot Holders. The warrants are currently trading on the over-the-counter (OTC) exchange under the ticker symbol “RBZWF” and currently priced at $0.065, unchanged on April 04, 2019. It is not known if the new warrant offering will have any implications on the company&#8217;s ongoing listing requirements given that its existing warrants have been delisted earlier.</p>
<p><strong>Net tangible book value under stress</strong></p>
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	<th class="column-1">Current Market Capitalisation (US$)</th><th class="column-2"> 23,840,000 </th>
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	<td class="column-1">Number of ordinary shares outstanding (April 02, 2019) (US$0.0008 par value)</td><td class="column-2"> 2,687,286 </td>
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	<td class="column-1">Share Price (April 04, 2019) (US$/share)</td><td class="column-2">9.02</td>
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	<td class="column-1">Net Tangible Book Value (December 31, 2018)</td><td class="column-2">-9.14</td>
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<p><em>Source: Company’s SEC Filings, Yahoo! Finance (April 04, 2019)</em></p>
<p>Reebonz’s net tangible book value as of December 31, 2018, has already turned negative at minus $9.14 per share, along with a total shareholders’ deficit of minus $21.55 million. The additional share issuance will potentially pose a significant downside to an already deeply negative overall net tangible book value.</p>
<p>There is also a chance that the latest securities offering can potentially be shareholder dilutive.</p>
<p><a style="font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 16px;" href="https://media.dealstreetasia.com/uploads/2019/04/Reebonz-Stock-Price-April-05-2019.jpg"><img loading="lazy" decoding="async" class="wp-image-129307 size-full" src="https://media.dealstreetasia.com/uploads/2019/04/Reebonz-Stock-Price-April-05-2019.jpg?resize=640,323" alt="" srcset="https://media.dealstreetasia.com/uploads/2019/04/Reebonz-Stock-Price-April-05-2019.jpg?w=1281 1281w, https://media.dealstreetasia.com/uploads/2019/04/Reebonz-Stock-Price-April-05-2019.jpg?resize=300,151 300w, https://media.dealstreetasia.com/uploads/2019/04/Reebonz-Stock-Price-April-05-2019.jpg?resize=768,387 768w, https://media.dealstreetasia.com/uploads/2019/04/Reebonz-Stock-Price-April-05-2019.jpg?resize=1024,516 1024w" sizes="(max-width: 1281px) 100vw, 1281px" data-recalc-dims="1" /></a></p>
<p><em>Source: Yahoo! Finance (Intraday price chart of Reebonz’s stock price, April 04, 2019)</em></p>
<p>Reebonz stock closed trading on April 03, 2019 at $12.10, but when it re-opened the following day at $9.49, the stock price fell precipitously on the news of the revised securities offering of up to $51.75 million, assuming both the ordinary share and warrant issuances are fully taken up. The intraday decline at the market close was about 25.45 per cent, or down $3.08 at $9.02. In after-hours trading, Reebonz’s stock price shot back up by 68 US cents, or 7.54 per cent, to end at $9.70.</p>
<p>The total stock trading volume intraday on April 4 for Reebonz was 338,384 shares, which is less than the average three-month daily trading volume of 753,677 shares. With an estimated 1.13 million public share float, the stock is highly susceptible to huge swings in share prices.</p>

Nasdaq-listed Reebonz Holding Limited submitted amended SEC filing to include warrant offering to purchase $25 million of the company’s ordinary shares.

Reebonz files for $25m warrant offering, may trigger further share dilution

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Reebonz files for $25m warrant offering, may trigger further share dilution

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