Here’s this week’s upcoming IPO:
Adamas One Corp
This company is offering 3.15 million shares of common stock as part of its IPO, while an additional 4.02 million shares are being sold by selling stockholders.
Adamas says it anticipates that the initial public offering price of its common stock will be between $4.50 and $5.00 per share. The company is joining the NASDAQ index under the ticker symbol ‘JEWL’.
What is Adamas One Corp?
Adamas produces diamonds and diamond materials using a process which it refers to as its diamond technology. The business says its lab-grown diamonds are not considered synthetic or simulant diamonds like cubic zirconia and moissanite.
The company intends to sell its products at wholesale and retail. Adamas says it is in the initial phases of commercializing diamonds and diamond materials, and its primary mission is the development of a profitable and sustainable commercial production model for the manufacture and sale of diamonds and diamond materials.
By its own admission, the business currently has limited available commercial products and has sold minimal diamonds or diamond materials. Its current operations are dedicated to the research and development of its technology and the exploration of markets that it may exploit in the future.
Adamas says it is unable to predict the timing of its entry into any market in the future.
The business was incorporated in September 2018 in the state of Nevada.
Adamas and Scio Diamond
In 2019, the company acquired all the assets of Scio Diamond Technology Corporation. These consisted primarily of proprietary diamond growing chemical reactors, patents and all intellectual property related. These were acquired for an aggregate of 1,500,000 shares of Adamas’ common stock and payment to certain lenders of Scio of an aggregate of $2.1m in cash.
According to Adamas, Scio spent “tens of millions” of dollars on developing its technology but ran out of money before successfully commercializing its product.
Scio had been listed on the OTC market under the ticker ‘SCIO’, but its registration was suspended by the SEC in August 2019 after failing to file reports.
Addressing Scio’s failings, Adamas’ IPO prospectus said:
“It is our understanding and belief that the commercialization issues experienced by Scio were related to Scio’s inability to raise sufficient capital at reasonable rates. Scio also attempted to shift its production from solely industrial diamond materials to rough diamond gemstones and did not have the time or capital to fully make that shift in its production.
“We have benefited from Scio’s development efforts on diamond gemstones and have a strategy to deliver finished diamond gemstones (as opposed to rough diamond gemstones) to the market, enabling us to participate in a higher margin sector with a better product. We believe that Scio did not have that option due to their capital constraints.”
Who is Leading the JEWL Stock IPO?
The listing is being helmed by Alexander Capital LP.
JEWL IPO Use of Proceeds
Of the net proceeds from this offering, the company said it expected to use approximately:
At least $8.1m for construction management and operating expenditures, including preparation and leasehold improvements at a 23,485 square foot manufacturing and production facility already under lease in Greenville, South Carolina.
Around $0.6m for continued research and development related to developing new products and maintaining and seeking improvements to existing products.
Approximately $1.5m to upgrade sales and marketing capabilities.
The remainder for working capital and other general corporate purposes.