E-commerce payment technology developer CyberCash, Inc. (Nasdaq: CYCH) announced Friday that it has picked up another $15 million in equity investments through a private placement of stock and warrants. CyberCash plans to use the money for expansion, marketing, acquisitions and investments.
Rose Glen Capital International Investors, LDC is handling the offering, which consists of $15 million worth of CyberCash common shares. The shares were priced at $9.125 each, the average closing price on the three days prior to closing the agreement. CyberCash also issued a warrant for the purchase of 164,384 shares of common stock at about $11.41 per share.
“We’re encouraged by the confidence shown by Rose Glen Capital’s continued investment in CyberCash,” CyberCash Chief Financial Officer Dennis Cavender said. The money will come in handy as CyberCash launches the $10 million to $15 million corporate branding campaign it announced late last month. That program will be “designed to enhance the company’s leadership position in providing merchants with e-commerce solutions,” CyberCash said.
Stock Fences to Mend
After trading in the low $20 range for most of the summer, CyberCash’s stock price has slipped to today’s opening price of $9.31.
The slump seems to have been sparked by the early August branding campaign announcement, but CyberCash Chairman Bill Melton insists there is no concrete basis for Wall Street’s jitters. “CyberCash’s payment business remains strong,” he said. “At the beginning of the year, we stated that our primary 1999 goal for this business was to increase our merchant base. We have made excellent progress toward that goal.”
Melton added that strategic relationships with Compaq, Concentric, Earthlink, INTERSHOP and Microsoft demonstrate that progress.
Earlier this week, CyberCash announced a partnership with HNC Software Inc. to include HNC’s Internet fraud detection service with CyberCash online payment systems. More than 14,000 online merchants using CyberCash’s systems will get the new eFalcon fraud detector, CyberCash said.
CyberCash develops secure payment technologies and services to enable e-commerce on the Internet and in other electronic retailing environments. Their software products for merchants, billing companies, financial institutions and consumers offer a variety of payment methods, including credit, debit cards, purchase cards, cash and checks.