Bankruptcy for DragonWave, Inc.(USA) (NASDAQ:DRWI)?

DragonWave, Inc.(USA) (NASDAQ:DRWI)

DragonWave, Inc.(USA) (NASDAQ:DRWI) shares are down almost 70%, on massive volumes, and have hit new 52-week lows after the company received notification from creditors of their intent to place the company in receivership. DRWI shares closed at $0.89 on Friday after the Toronto Stock Exchange suspended trading in the shares based on the afore-mentioned news. However, DRWI shares appear to be trading on the Nasdaq Exchange as of this morning.

Comerica Bank and Export Development Canada, secured lenders to DragonWave, have filed an application with the Ontario Superior Court of Justice to appoint KSV Kofman Inc. as receiver over the business and assets of DragonWave, Inc.(USA) (NASDAQ:DRWI). The Application is scheduled to be heard today at 9:30 a.m. The lenders stated that they will pursue a short, court-supervised sale process conducted by KSV Kofman Inc. to maximize value for the lenders and other stakeholders.

DragonWave, Inc.(USA) (NASDAQ:DRWI) received notice from the Toronto Stock Exchange (TSX) that the exchange is reviewing the listing eligibility for DRWI shares pursuant to Part VII of the TSX Company Manual – specifically the terms outlined in section 708 (Insolvency) and sections 709 and 710(a)(i) (Financial Condition and/or Operating Results) of the Company Manual are applicable to the Company. DragonWave, Inc.(USA) (NASDAQ:DRWI) is being reviewed under the Expedited Review Process of the TSX. As a result, the Company’s shares have been suspended from trading until further notice. A meeting of the Continued Listing Committee of the TSX is scheduled to be held on July 31, to consider whether or not to delist DRWI shares. If Dragonwave’s securities are delisted from the TSX, the company may consider an alternative listing on the TSX Venture Exchange or NEX.

Lastly, the Nasdaq Exchange has informed DragonWave, Inc.(USA) (NASDAQ:DRWI) that they will receive a notice of delisting on Monday, July 31, 2017, with delisting to occur on Wednesday, August 2, 2017.

Information on this company is fluid and sometimes contradictory – even from established news sources. If you plan to enter or exit a position we strongly encourage you to personally consult with a reputable broker who has access to primary sources of information.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

Don’t miss out! Stay informed on $DRWI and receive breaking news on other hot stocks by signing up for our free newsletter!

About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

DragonWave, Inc. (USA) (NASDAQ:DRWI) Explodes On NASDAQ Delisting Reversal

DragonWave, Inc. (USA) (NASDAQ:DRWI)

DragonWave, Inc. (USA) (NASDAQ:DRWI) has regained compliance with the NASDAQ having been hit with a delisting notice for failing to meet the minimum shareholders’ equity of $2.5 million. However, the company’s continued listing on the NASDAQ is still subject to meeting certain milestones which includes ensuring the minimum shareholder equity stands at $2.5 million.

While the company’s listing on the Toronto Stock Exchange is not impacted by the decision, DragonWave maintains it is working round the clock to meet the minimum requirement.

SmartSky Contract

Separately, the global supplier of packet microwave radio systems says it has inked a product supply and services contract with SmartSky Networks. The North American 4G LTE inflight service provider is to deploy the company’s Harmony Enhanced and Harmony Enhanced MC products as part of the contract.

“The DragonWave Harmony Enhanced MC product solution offers our desired capacity requirements for SmartSky. Harmony Enhanced MC delivers simple installation, operation, and sophisticated remote management, so we are thrilled to partner with them to further enhance SmartSky’s capabilities, “said SmartSky Networks vice president of services Dave Claassen.

SmartSky is in the process of deploying its coast-to-coast national network having recently secured $170 million Series B financing.

Disappointing Q4 Earnings

The signing of the contract with SmartSky comes on the heels of DragonWave, Inc. (USA) (NASDAQ:DRWI) posting disappointing financial results for its fourth quarter. The company has been experiencing difficult operating conditions after having posted a net loss of $3.9 million. Revenue for the fourth quarter tanked to $8 million from $10.2 million in the third quarter.

DragonWave, Inc. (USA) (NASDAQ:DRWI) Operating expense for F2017 dropped by $9.9 million compared to the previous fiscal year, to $27.9 million, having dropped to $6.7 million in the fourth quarter compared to $7 million as of the third quarter.

“Our results in Q4 reflect the difficult operating conditions. Earlier this year we communicated that we had made a restructuring proposal to our credit facility partners to reduce operating expenses and address working capital. In co-operation with our secured lenders we have engaged Alvarez & Marsal Canada ULC to assist us with the identification and assessment of strategic alternatives in relation to short-term liquidity requirements,” said CEO, Peter Allen.

DragonWave, Inc. (USA) (NASDAQ:DRWI) exited the fourth quarter with cash and cash equivalent of $4.1 million compared to $4.5 million as of the end of the third quarter.

DragonWave, Inc. (USA) (NASDAQ:DRWI) stock ended Wednesday trading session at $1.13 a share having rallied by 75.19%.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

Don’t miss out! Stay informed on $DRWI and receive breaking news on other hot stocks by signing up for our free newsletter!

About the author: Monica Grey has an undergraduate degree in Accounting and an MBA she earned – with Honors. She has six years of experience in the financial markets and has been an analyst for the past two years.