Collexis continues to pump out stock

The rate at which Collexis Holdings is diluting its stock would make the leaders of inflation-ridden Wiemar Germany of the 1920s proud.

Columbia, SC-based Collexis has issued 44.5 million shares of stock in the past few weeks, all at 7 cents a share. That netted the struggling technology company a little more than $3 million, helping it keep its head above water financially.

Now, more dilution is on the way. In the company’s most recent quarterly report, it said that it is conducting an additional private placement of common stock to try and raise another $4 million.

Should this offering be fully subscribed at what appears to be the current going rate of 7 cents a share, it would mean the company would issue another 57.1 million shares.

Given the fire sales prices on company stock, Collexis’s future remains, unsurprisingly, murky at best.

“With the full subscription of our $4.0 million private placement referred to above, combined with any funds generated from our operations, we believe we will have sufficient cash to fund our operations through July 31, 2009,” the company said in a recent filing with the US Securities and Exchange Commission. “However, this will not provide sufficient capital to pay our deferred purchase obligations of approximately $2.2 million due over the next three months.”

Collexis has had to dilute its stock to stay afloat because the company has suffered major losses over the past couple years. It lost more than $5 million for the first nine months of the current year and more than $11 million during the fiscal year ended June 30, 2008.

Last year, the company’s independent accounting firm included an explanatory paragraph in Collexis’s annual report that expressed substantial doubt about Collexis’s ability to continue as a going concern.

Not surprisingly, Collexis’s stock price as dwindled as the company continues to issues shares. It closed Wednesday at 8 cents a share, compared to its 52-week high of 75 cents a share. Collexis’s stock sold for as much as $12 a share just a couple years ago.