Digital Brands Group Inc. (DBGI) stock prices were up by 43.05% shortly after market trading commenced on September 28th, 2021. This brought the price per share up to USD$4.22 early on in the trading day.
DBGI Stock Announces Guidance
September 28th 2021 saw DBGI stock announce the increase of its initial 2022 revenue guidance. The new forecast ranges from USD$37.5 million to USD$42.5 million. This represents a 350% increase from the revenue expectations from fiscal 2021. Furthermore, the company expects positive EBITDA for 2022. These developments reflect the power the company’s brand portfolio, with the possibility to further improve following any potential acquisitions.
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Acquisition of Stateside
DBGI stock reported the completion of its previously announced acquisition of Stateside. The privately owned elevated basics brand has been agreed to be purchased for an aggregate base price of USD$10 million. The purchase was evenly split between USD$5 million in common stock based on the 30-trading day period volume-weighted average of the closing of the company’s share price. The other USD$5 million would be comprised of cash from the company’s reserve.
Raising Capital
The company announced the generation of gross proceeds in the amount of USD$5 million. The funds were raised through the issuance of a senior secure convertible promissory note to Oasis Capital. DBGI stock’s note has a principal amount of USD$5.262 million and bears an interest rate of 6% per annum. The notes are due and payable 18 months from the date of issuance, with the option to be converted before that date.
Synergistic Collaboration
DBGI stock also announced having entered into an equity purchase agreement with Oasis Capital. As per the agreement, the company has the right to sell up to USD$17.5 million of its common stock to Oasis Capital over a 24 month period. This is contingent on the satisfaction of the conditions in the equity purchase agreement. This includes the effectiveness of a resale registration statement which the company will file before the end of the 2021 year.
Future Outlook for DBGI Stock
The company reported a promising quarter, consolidated by its recent capital generation and acquisition. DBGI stock is poised to capitalize on the opportunities presented to it over the upcoming quarters. Current and potential investors are hopeful that management will be able to leverage the resources at their disposal. This is hoped to facilitate significant and sustained increases in shareholder value.
