Selecta Biosciences Raises $39 Million in Stock + Warrants Deal

Edward Kim  |

Selecta Biosciences ( SELB) announced Wednesday an offering of common stock and warrants that raised gross proceeds of $38.7 million.

The Watertown, Massachusetts-based biotech sold 27,428,572 shares of its common stock and warrants to purchase up to 20,571,429 shares of common stock at a combined offering price of $1.41.

Each share of common stock sold was accompanied by a warrant to buy 0.75 shares of common stock at an exercise price of $1.55 per share. The warrants, which will not trade, are immediately exercisable and will expire in five years.

Selecta is developing therapies for serious and debilitating diseases that selectively mitigate unwanted immune responses.

Video source: Selecta Biosciences

Investment thesis

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Selecta Biosciences went public in June 2016, raising $70 million in gross proceeds at $14 per share at a post-money market cap of about $250 million.

Shareholders have been frustrated with the company's clinical progress to date, but at current levels we see potential for investors with a long horizon and high risk tolerance.

  • At Wednesday's close of $1.30 per share, the company has a market cap of just $165 million.
  • Selecta had cash and equivalents of $129 million as of Dec. 31, 2021.
    • This latest equity and warrants offering gives investors a virtually free call option on the company's portfolio of therapeutic candidates.
  • Last month, the FDA lifted its clinical hold on the company's gene therapy program for methylmalonic academia (MMA).
  • The company generates revenue through numerous collaboration agreements with companies including: AskBio, Sobi, Sarepta, Cyrus Biotechnology, Takeda, Genovis and Gingko Bioworks.
  • Selecta's precision immune tolerance platform has the potential to restore self-tolerance in autoimmune disease and overcome immunogenicity of gene therapies and biologics across a broad range of indications.

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Image source: Selecta Biosciences


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