For the IPO market, 2022 will be one of the most disappointing years in terms of activity, especially when compared to last year’s record-high listings. With only a few weeks left for the year to come to an end, IPO activity is yet to pick up as investors keep away from stock markets amid economic uncertainties.
Among the latest aspirants, chemical company ASP Isotopes Inc. is preparing to offer around two million shares in a public offering. The estimated offering price is between $5.00 per share and $7.00 per share, which will generate around $12 million at the mid-point of the range. Pursuant to the offering, the stock will trade on the Nasdaq Capital Market under the symbol ASPI. Revere Securities LLC is the sole book-running manager.
Use of Proceeds
While the offering creates a public market for the company’s shares, funds raised through it will be mainly used for enhancing capitalization and financial flexibility. A key priority would be to fund the phase-II development targeting expanded production of up to ’20 kg/year of 95% enriched molybdenum-100′, after completing the initial phase that started a year ago. The remainder of the proceeds will be used for research and development for potential additional isotopes and for general corporate purposes.
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The Florida-headquartered advanced materials company was founded in September 2021 by Robert Ainscow and Paul Mann, who has served as the chief executive officer since then. It operates through the subsidiaries of ASP Isotopes Guernsey Limited, ASP Isotopes South Africa Limited, Enriched Energy LLC, and ASP Isotopes UK Ltd.
The Business
ASP Isotopes is engaged in the development of technology and processes that would facilitate the production of isotopes that may be used in several industries. Armed with an exclusive license to use its proprietary technology called Aerodynamic Separation Process, the company is focused on the production and commercialization of enriched Molybdenum-100 that is expected to have potential advantages for use in the preparation of nuclear imaging agents by radio-pharmacies and others in the medical industry.
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In the six months that ended June 2022, ASP Isotopes incurred a net loss of $1.68 million, due to the absence of marketable products. Comprehensive loss, excluding one-off items, was $1.56 million or $0.06 per share. Being a pre-commercial stage company, it did not generate any revenue during the period.
Risks
Meanwhile, the products might face regulatory scrutiny once they are commercially launched, since the company has not sought any regulatory approval for the application of Mo-100. The high costs associated with obtaining clearance and the lengthy process might be a hassle for reaching the target market.