14 DAY TRIAL // After years of seeing its market share and stocks decline Transmeta now tries to secure an important sum in order to secure its financial position for the remainder of the year. The company tries to raise $12.8 million in cash from selling 2 million Transmeta common stock shares and from warrants to purchase another million of the same stock shares.
Transmeta will sell securities shares at a price of $6.4 per share and they include a warrant to purchase 0.5 shares at a price or $9.0 per share and this deal is expected to close around the 26th of September. After this announcement, the already low price per Transmeta share fell another 17 percent or about $1.26 reaching $6.29, which is very close to the lowest ever price of $6.00 per share that the company saw in June.
As the company is no longer developing processing units or chipsets and it is only licensing a number of technologies that are related to lowering power consumption and overall energy footprints in computer and embedded systems, its only revenues are generated by the number of licensing hardware companies that are interested in such technologies.
As its latest power saving technology, the Longrun 2, has yet to generate any significant income, the company had to take several steps, including the sell of common stock, in order to assure a high enough level of cash that would allow it to continue its operations. Transmeta is not at the first selling action of common stock right now, as sometime ago Advanced Micro Devices purchased 1 million of the company's shares for $7.5 million and later the company went through a 1:20 stock split that allowed it to maintain the price per common share above the critical $1 mark.
Transmeta recently announced several important customers for its technologies including companies like NEC and so it can expect some royalties to come in but it is not yet sure if they will be able to change its abysmal financial situation as it registered already losses of $11.5 million while revenues mounted to only $171,000. According to the news site tgdaily Transmeta already laid off most of its work force and now only a core of 45 workers are still active.