Paris-based Sequans Communications has secured $50 million in financing in a move to strengthen its balance sheet. The financing is provided by Lynrock Lake Master Fund and consists of $10 million of American Depository Shares and $40 million principal amount of convertible debt.
“A stronger balance sheet improves Sequans’ standing as we accelerate our Massive IoT business and engage with potential strategic partners interested in our 5G technology,” comments Sequans CEO Georges Karam. “Increased cash on our balance sheet also provides the Company with additional working capital to manage the ongoing component and supply chain dynamics.”
The primary use of this financing will be the repayment of $11.7 million in convertible debt and interest that is due on April 14.
Sequans will retain the option to call the convertible debt under certain circumstances after 12 months, subject to a 9.9% ownership limit for Lynrock Lake. Lynrock Lake did not request a board seat as part of the financing.
“Sequans is pursuing an aggressive 5G product roadmap for Broadband and Critical IoT, partially funded by strategic partners and investment from the French government,” said Cynthia Paul, Chief Investment Officer of Lynrock Lake. “We are excited to partner with Sequans to strengthen their capital structure and improve their strategic positioning as they engage with new and existing partners and suppliers.”