Solta Medical (NSDQ:SLTM) released pricing on a $15 million public offering intended to raise funds for general corporate purposes after the aesthetics devices maker incurred substantial charges during its 2nd quarter.
Solta’s Q2 losses swelled more than 12600% on a $26 million "fair value reassessment" for fat-reduction device maker Liposonix, which the company acquired for $15 million plus pay-outs late last year. The new assessment doubles the previous consideration and brings the new total to $58.5 million in payments over the next 7 years.
The increase is "due primarily to our estimate of higher achievement in specified net sales and adjusted gross profit targets," Solta noted in its latest earnings report.
Solta in September 2011 agreed to pay $15 million in up-front cash and another $5 million in milestone payments for Medicis Pharmaceutical Corp.’s (NYSE:MRX) Medicis Technologies Corp., formerly LipoSonix.
In Q1 2012 Solta notched a doled out $4.7 million in expected milestone charges related to the merger, which closed in November. Liposonix develops an ultrasound-based fat removal system that won FDA clearance for a second-generation model in October 2011.
The device garnered just under $9.4 million in sales during the 2nd quarter, spurring a 40% bump in production in order to meet demand, according to a press release.
Solta announced the offering in its 2nd quarter earnings report, noting that proceeds may go toward contingent payment obligations related to the Liposonix acquisition as well as for other general purposes.
The Hayward, Calif.-based aesthetics devices maker today priced 5.6 million shares of its common stock at a public price of $2.65 per share, expecting to net $14 million by August 7.
Merger-related charges drove losses to $26.3 million, or a loss of 43¢ per share, compared with a $206,000 in losses during the same period last year.
Solta reported $37.3 million in sales for the 3 months ended June 30, representing an impressive 28.7% spike from the $29 million in sales reporting for the same period last year. Solta increased its 2012 sales guidance to $142-$144 million (previously $140-$143 million).
Not mollified by the optimistic outlook, Wall Street fled from SLTM shares today and shares dropped 15% to close at $2.71.