A struggling local tech company has closed two previously announced transactions aimed at stabilizing its business, the firm announced this week.
Optical component manufacturer Enablence Technologies Inc. (TSX-V:ENA) has closed a non-brokered private placement with existing shareholders worth $3.01 million – up from the $2.7 million originally expected from the deal.
Enablence issued 9.1 million common shares at $0.33 per share, each subject to a four-month hold period mandated by securities laws, which will expire on June 20.
Over the past several months, the company has raised more than $8 million through the issuance of equity and asset sales.
In addition, Enablence converted some of its debt by issuing 10.8 million common shares to former shareholders of Pannaway Technologies, which merged with Enablence in 2008. The shares served to cancel certain unsecured convertible notes and repay debt in the amount of approximately $3.5 million. These shares are also subject to a four-month hold period.
Enablence claims it has reduced its debt by approximately $6.7 million during the past few months.
Earlier this month, Enablence appointed Louis De Jong as its new CEO, taking the place of John Roland who acted as interim CEO after Tim Thorsteinson left the post last June.
Mr. De Jong is the founder and managing partner of Toronto-based De Jong & Co., a boutique merchant bank dealing in principal investment and financial advisory services. Prior to founding the company, Mr. De Jong was managing director of a hedge fund focused on small and medium-sized capitalized Canadian companies.
In a general business update provided on Feb. 11, the company stated that Enablence is seeing improved order flow across existing product lines as a result of better conditions in the optical industry, and the company’s strengthened financial position overall.
Last November, the company sold its wholly owned Swiss subsidiary Enablence Switzerland AG to Albiva Holdings AG, a move the company said would raise $2 million.
It was the second business unit sale of the year for Enablence, which had warned investors last June that its cash position was so perilous that it may have to pursue insolvency proceedings.
Enablence has been posting deep losses in recent quarters but taking measures to address the situation, including selling an underperforming systems division, lessening inventory and reducing staff.