Deal may be increased to $40 million; Renova US Holdings is investor
By Devika Patel
Knoxville, Tenn., April 14 - Ameritrans Capital Corp. priced a $25 million private placement of stock on April 12, according to an 8-K filed Thursday with the Securities and Exchange Commission. The deal may be increased to $40 million and will be conducted in multiple closings over two years.
The company will sell the common shares to Renova US Holdings Ltd. at the greater of $1.80 per share and the per-share net asset value of the company, as determined by the board of directors up to two days before closing. The $1.80 price per share is an 81.82% premium to the April 11 closing share price of $0.99.
Settlement of the first tranche is expected by Nov. 30.
The company also amended a senior secured note it sold to Ameritrans Holdings LLC on Jan. 19, 2011. On April 12, the companies agreed to insert a clause which prohibits the company from borrowing over $250,000, with the exception of borrowing up to $500,000 for working capital.
Based in New York, Ameritrans makes loans to and investments in small businesses.
| Issuer: | Ameritrans Capital Corp.
|
| Issue: | Common stock
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| Amount: | $25 million
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| Tenor: | Two years
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| Price: | Greater of $1.80 and the per-share net asset value of the company
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| Warrants: | No
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| Investor: | Renova US Holdings Ltd.
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| Pricing date: | April 12
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| Settlement date: | Nov. 30
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| Stock symbol: | Nasdaq: AMTC
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| Stock price: | $0.99 at close April 12
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| Market capitalization: | $4.41 million
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