Blue Star issues USD 5 million stock offer

After putting a potential NASDAQ Stock Market delisting behind it, blue crab supplier and recirculating aquaculture systems (RAS) operator Blue Star Foods announced a public offering of an aggregate of more than 10.7 million shares of its common stock together with accompanying common stock warrants.

The Miami, Florida, U.S.A.-based firm expects total gross proceeds from the offering, before deducting the placement agent's fees and other offering expenses, to be around USD 5 million (EUR 4.7 million). The stock is priced at USD 0.47 (EUR 0.44) per share (or common stock equivalent) and accompanying warrants, the company said.

Blue Star intends to use the net proceeds from the offering for general corporate purposes and repayment of certain outstanding debt. The closing of the offering is expected to occur around 11 September, subject to the satisfaction of customary closing conditions, the company said.

Blue Star announced on 20 June it engaged in a reverse stock split of its outstanding common stock to raise its per-share price. Blue Star was facing a potential delisting from the Nasdaq Stock Market due to its price dropping below the market's mandated minimum trading value of USD 1.00 (EUR 0.93) per share.  But it received confirmation from Nasdaq on 11 July it had regained compliance with the minimum bid price requirement and all other listing standards, and that it will continue to be listed on the exchange.

The company contended in February 2023 it was struggling with potential illegal short selling of its stock. In response, it entered into a service agreement with ShareIntel-Shareholder Intelligence Services to combat any potential illegal short selling.

“Based on the trading pattern of the stock, we are concerned that our company may have been the target of a market manipulation scheme involving illegal short selling of our stock over the past year, and we are committed to investigating and exposing any wrongdoing,” Blue Star Foods Chairman and CEO John Keeler said at the time.

Separately this week, Blue Star announced its soft-shell crab operations in South Carolina received a license renewal from the South Carolina Department of Natural Resources. The new license covers Blue Star as a wholesale dealer and wholesale dealer-peeler for crab and runs through June 2024.

“Our plans for the next 12 months include the expansion of operations for our crab hibernation facility, processing, cold storage distribution hub, and footprint for soft-shell crabs in South Carolina,” Keller said. “Our exclusive Bio-Harvesting technology Crab Hatchery will be a highlight of the expansion, to better understand the genome code responsible for growth and reproduction.”

The proprietary technology and process enables Blue Star to utilize high performing blue crab strains, according to Keeler. "The result will produce a sustainable balance for what crab fisheries can supply against the rapid growth in soft shell crab demand.”

The per-share price of the company’s stock stood at USD 0.44 (EUR 0.41) on Thursday, 7 September.

Photo courtesy of Blue Star Foods