NuZee, a Plano-based coffee company, is planning to raise about $12 million in an initial public offering, a new federal filing shows.
On the heels of a $2 million private equity raise, the company announced that it will be filing for a potential IPO as it looks to expand its operations and grow into new markets. The company plans to offer stocks at $11 per share. NuZee said it plans to use the proceeds of the IPO to expand its co-packing activities and facilities, as well as support the company’s capital needs.
“Our mission is leverage our position as a co-packer at the forefront of the North American single serve pour over coffee market to revolutionize the way single serve coffee is enjoyed in the United States,” the company wrote in its Form S-1. “We intend to leverage our position to be the commercial manufacturer of choice for major companies seeking to enter the single serve drip cup market in North America.”
NuZee moved its headquarters to Plano in August from California, where it still maintains a facility. While largely focused on the North American market, the company also operates in Japan and Korea. Founded in 2011, NuZee is focused on packaging and selling single-serve coffee products, through its NuZee, Coffee Blenders and Twin Peaks coffee brands.
In its private equity offering, the company sold more than 111,000 shares of common stock at $17.85 per share. It is traded on the OTCQB marketplace under the symbol NUZE. According to filing documents, the company cleared more than $2 million in sales in the first half of this year. For the nine months ending in June 30 of this year, the company recorded more than $715,000 in North American net revenues.
In its filing, NuZee listed a number of potential risk factors related to the IPO, including recording net losses for the past three years. In 2018, the company recorded about $3.6 million in net losses. It also said that increased competition and changes within the beverage and retail ecosystems could also pose potential risks to NuZee.
NuZee has a five-year lease on its Plano headquarters, where it has 20 packaging machines and about 30 employees. The company said it chose Plano as its home due to reduced freight and operating costs and because of its scalable economy.
“We plan to opportunistically leverage our strengths and relationships to grow our proprietary NuZee and Coffee Blenders brands in the United States and select international markets,” the company said in its S-1.
