Israeli company Kornit Digital (Nasdaq: KRNT), which manufactures digital printing systems for the textile industry, has announced a $27.50 share price for its upcoming secondary offering on Nasdaq, in which it plans to raise $119 million. If the underwriters exercise their 30-day greenshoe options to buy 651,000 shares in Kornit Digital, it will increase the amount raised by the company by $18 million.
Kornit Digital plans to use the money from the offering for general business purposes and working capital. The company says that it will also use the proceeds for future acquisitions, including of complementary activities, technologies, and assets. At the same time, Kornit Digital says that as of now, it is not conducting any talks, and has no agreement for any acquisition deal whatsoever. The underwriters for the offering are Citigroup, Goldman Sachs, and Berkleys, as well as William Blair, Stifel, Needham, and Craig-Hallum Capital Group.
Kornit Digital, managed by CEO Ronen Samuel, raised $71 million in its IPO in April 2015 at $10 a share and a company value of $288 million. The company has since held a number of secondary offerings, although only one of them raised money for the company (the others were offers for sale). Kornit Digital raised $33 million in a secondary offering in January 2017 at $16.50 a share, while its controlling shareholder at the time, private equity fund Fortissimo, sold part of its holdings for $90 million. Four months later, Fortissimo sold more shares for the same amount at $20.60 a share, and the rest of its holdings in Kornit Digital in December 2018 for $70 million at $20.50 a share.
The trend in Kornit Digital's share this year has been positive. A month ago, Kornit Digital's share price suffered a reverse when investment concern Spruce, which specializes in short investments, recommended selling the share, claiming that it had a downside risk of 75-85%. The share price dropped 9% in response to the recommendation, but has since returned to its previous level. Kornit Digital dismissed Spruce's assertions, with Samuel calling them "a lot of nonsense." Samuel said that Kornit Digital's business with its strategic customers was "better than ever."
Published by Globes, Israel business news - en.globes.co.il - on June 16, 2019
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