SLXN.NASDAQSilexion Therapeutics CORP

8-K: Silexion Therapeutics Updates Financials Reflecting Reverse Share Split

Sentiment:

8-K Filing

📋All filings for Silexion Therapeutics CORP
🔒Login to Follow

Silexion Therapeutics Corp files updated financial statements to reflect a reverse share split and provides details on its financial condition.

Capital raiseThe company entered into an ordinary share purchase agreement for an equity line of credit (ELOC) with White Lion Capital, LLC, whereby New Silexion will be able to request to sell to the ELOC Investor, and the ELOC Investor will be required to purchase, via private placement transactions, up to $15,000 of New Silexion ordinary shares from time to time after the Closing, up until December 31, 2025 (unless the agreement is terminated sooner), subject to certain limitations and conditions as described therein.On October 1, 2024, the Company completed an equity raise through the ELOC, issuing 293,777 ordinary shares for a total consideration of $1,658.On October 22, 2024, the Company completed an equity raise through the ELOC, issuing 66,667 ordinary shares for a total consideration of $200.
Worse than expectedThe company reported a net loss of $14.772 million for the nine months ended September 30, 2024, which is worse than the net loss of $3.428 million for the same period in 2023.The company has a capital deficiency of $4.579 million as of September 30, 2024.The company has a going concern warning.

Summary

  • Silexion Therapeutics Corp filed a Form 8-K including updated financial statements for the quarter and nine months ended September 30, 2024, and for the year ended December 31, 2023.
  • The updates reflect a 1-for-9 reverse share split of the company's ordinary shares.
  • The reverse share split was approved by shareholders on November 19, 2024, and became effective on November 29, 2024.
  • The updated financials include unaudited condensed consolidated statements as of September 30, 2024, and audited financial statements for the year ended December 31, 2023.
  • The company had cash and cash equivalents of $1.973 million as of September 30, 2024.
  • The net loss for the nine months ended September 30, 2024, was $14.772 million.
  • The company is still in its development and clinical stage and has not yet generated revenues.

Sentiment

Score: 3

Explanation: The sentiment is negative due to the significant net loss, going concern warning, and Nasdaq deficiency letter, offset slightly by the completion of the SPAC merger and ELOC financing.

Positives

  • Additional paid-in capital increased from $11.335 million at the end of 2023 to $37.003 million as of September 30, 2024.
  • The company completed a business combination with a SPAC on August 15, 2024.

Negatives

  • The company reported a net loss of $14.772 million for the nine months ended September 30, 2024.
  • The company has a capital deficiency of $4.579 million as of September 30, 2024.
  • The company has a going concern warning.

Risks

  • The company is still in its development and clinical stage and has not yet generated revenues.
  • The company expects to continue incurring losses and negative cash flows from operations.
  • There is substantial doubt about the company's ability to continue as a going concern.
  • The company's headquarters are located in Israel, and any hostilities involving Israel could adversely affect the company's operations.
  • The company received a deficiency letter from Nasdaq because the closing bid price of the company's ordinary shares was below the minimum $1.00 per share required for continued listing.

Future Outlook

Management is in the process of evaluating various financing alternatives, as the Company will need to finance future research and development activities, general and administrative expenses and working capital through fund raising. However, there is no assurance that the Company will be successful in obtaining such funding.

Industry Context

The company is operating in the competitive biotechnology industry, focusing on innovative treatments for pancreatic cancer. The company's success depends on the outcome of clinical trials and its ability to secure funding.

Comparison to Industry Standards

  • It is difficult to compare Silexion to industry standards due to its early stage and lack of revenue.
  • Many comparable companies are also pre-revenue and rely on clinical trial results and funding to drive value.
  • The company's cash position of $1.973 million as of September 30, 2024, is relatively low compared to other publicly traded biotech companies, which may limit its ability to fund ongoing research and development activities.

Related Party Transactions

  • Share-based compensation included in research and development expenses with related parties was $1.796 million for the nine months ended September 30, 2024.
  • Share-based compensation included in general and administrative expenses with related parties was $2.972 million for the nine months ended September 30, 2024.
  • Financial expenses with related parties were $(47) for the nine months ended September 30, 2024.
  • A promissory note of $3.106 million is due to a related party as of September 30, 2024.

Stakeholder Impact

  • Shareholders face potential dilution from future equity issuances.
  • Employees' job security is uncertain due to the company's going concern warning.
  • The company's ability to continue its research and development efforts depends on securing additional funding.
  • Creditors face increased risk due to the company's financial difficulties.

Next Steps

  • The company must regain compliance with Nasdaq's minimum bid price requirement by April 28, 2025.
  • The company needs to secure additional funding to finance its operations and research and development activities.
  • The company will continue to monitor its ongoing activities and will make any needed adjustments to ensure continuity of its business, while supporting the safety and well-being of its employees.

Key Dates

DateDescription
November 30, 2008Silexion Therapeutics Ltd. was incorporated in Israel.
April 28, 2021Silexion signed an agreement with Guangzhou Sino-Israel Biotech Investment Fund (GIBF) to establish a new company in China.
June 15, 2021Silenseed (China) Ltd. was established in China.
March 15, 2021A Simple Agreement for Future Equity (SAFE) was signed between the Company and a group of investors.
January 14, 2022The Company converted the SAFE in the total amount of $3,204 (its fair value as of conversion date) into 7,037 Series A-3 Preferred Shares and 5,278 warrants exercisable into Series A-2 Preferred Shares.
January 14, 2022The company signed an agreement to issue shares in consideration for an investment in the amount of $2,763.
May 30, 2023The Company entered into an agreement to receive an investment in a total amount of $538.
April 3, 2024Silexion entered into an Amended and Restated Business Combination Agreement (A&R BCA) with Moringa acquisition Corp (the SPAC).
August 15, 2024The parties completed the Transactions pursuant to which Merger Sub 2 merged with and into the SPAC, with the SPAC continuing as the surviving company of such merger and a wholly-owned subsidiary of New Silexion (the SPAC Merger), and Merger Sub 1 merged with and into Silexion, with Silexion continuing as the surviving company of such merger and a wholly-owned subsidiary of New Silexion (the Acquisition Merger).
September 18, 2024The Company issued 40,602 ordinary shares to White Lion LLC as the Commitment Shares.
September 26, 2024The Company signed a new lease agreement for an office in Israel starting November 1, 2024 and ending on October 31, 2026.
October 1, 2024The Company completed an equity raise through the ELOC, issuing 293,777 ordinary shares for a total consideration of $1,658.
October 22, 2024The Company completed an equity raise through the ELOC, issuing 66,667 ordinary shares for a total consideration of $200.
October 29, 2024The Company received a deficiency letter from the Listing Qualifications Department (the Staff) of the Nasdaq Stock Market LLC (Nasdaq) notifying the Company that, for the 30 consecutive business days preceding the letter, the closing bid price of the Company’s Ordinary Shares was below the minimum $1.00 per share required for continued listing on The Nasdaq Stock Market.
November 19, 2024The Company's shareholders approved a 1-for-9 reverse share split of the Company's Ordinary Shares.
November 29, 2024The reverse share split became effective.
January 14, 2025Date of report (Date of earliest event reported).
April 28, 2025The Company has been given 180 calendar days, or until April 28, 2025, to regain compliance.

Disclaimer:The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.