DragonWave to raise $US6 million in new IPO

Ottawa-based DragonWave says it plans to raise US$6 million through a new public offering in the United States.

The offering will see DragonWave (TSX:DWI)(NASDAQ:DRWI) issue up to 1,791,044 units consisting of one common share and the right to purchase up to three common shares at fixed prices during specified timeframes.

An additional 63,000 units will be sold in Canada through a private placement.

The company says the money raised from the offering will be used for “general corporate purposes, which may include working capital, general and administrative expenses, capital expenditures and implementation of our strategic priorities.”

The offering will increase the number of outstanding DragonWave shares from 3,620,567 to 5,055,973 immediately following the close of the offering on Aug. 8.

DragonWave, which hasn’t turned a profit in more than five years, reported a quarterly net loss of $4.1 million in mid-July.

Shares in the company were down by $0.66 in trading on the Toronto Stock Exchange on Wednesday afternoon to $4.13.