Allot Announces Pricing of Underwritten Public Offering of Ordinary Shares

Rhea-AI Summary

Allot Ltd. (Nasdaq: ALLT) has announced the pricing of a public offering of 5,000,000 ordinary shares at $8.00 per share, with potential for an additional 750,000 shares through the underwriters' option. The offering is expected to generate gross proceeds of $40.0 million.

The company plans to use the proceeds primarily to repay $31.41 million of outstanding debt under the Lynrock Note, with the remainder for general corporate purposes. Additionally, Lynrock has agreed to convert the remaining $8.59 million of principal into 1,249,995 ordinary shares. Following these transactions, Allot will have no outstanding debt.

The offering, expected to close on June 26, 2025, is being managed by TD Cowen and William Blair as joint book-running managers.

Positive

• Complete elimination of outstanding debt post-transaction
• Successful pricing of $40 million public offering
• Strong institutional backing with major investment banks as underwriters
• Largest shareholder demonstrates confidence by converting remaining debt to equity

Negative

• Significant dilution for existing shareholders through 5,000,000 new shares plus potential 750,000 additional shares
• Additional dilution from 1,249,995 shares issued for debt conversion
• Share offering price may represent a discount to market value

Insights

Financial Restructuring Analyst

Allot's $40M share offering eliminates all debt, strengthening balance sheet while diluting equity by roughly 20%.

Allot is executing a $40 million equity offering at $8.00 per share, issuing 5 million new ordinary shares with an underwriter option for an additional 750,000 shares. The transaction has two critical components with significant balance sheet implications: $31.41 million of the proceeds will repay the majority of the outstanding convertible note held by Lynrock Lake (their largest shareholder), while Lynrock simultaneously converts the remaining $8.59 million of debt into 1.25 million additional shares.

This financial maneuver completely eliminates Allot's debt burden, resulting in zero outstanding debt post-transaction. While this creates a substantially stronger balance sheet with improved financial flexibility, it comes at the cost of approximately 20% equity dilution for existing shareholders through the combined public offering and debt conversion.

The strategic decision to eliminate debt improves Allot's financial stability and potentially signals management's intent to position the company for future growth initiatives. The modest portion allocated to "general corporate purposes" ($8.59 million) provides limited additional operating runway. The transaction structure, with Lynrock's 75-day lockup agreement, minimizes immediate selling pressure from the largest shareholder while maintaining their significant ownership position through the debt-to-equity conversion.

For a network security solutions provider like Allot, moving to a debt-free capital structure potentially provides greater flexibility to navigate the rapidly evolving security landscape and pursue strategic initiatives without debt service constraints.

Hod Hasharon, Israel, June 24, 2025 (GLOBE NEWSWIRE) -- Allot Ltd. (Nasdaq: ALLT; TASE: ALLT) (“Allot” or the “Company”), a leading global provider of innovative network intelligence and security solutions for service providers and enterprises worldwide, announced today the pricing of a public offering of 5,000,000 ordinary shares at a price to the public of $8.00 per share. In addition, the Company granted the underwriters of the public offering a 30-day option to purchase from the Company up to an additional 750,000 ordinary shares at the public offering price, less underwriting discounts and commissions. All of the ordinary shares in the public offering will be sold by the Company. The offering is expected to close on June 26, 2025, subject to customary closing conditions.

The gross proceeds from the offering, before deducting underwriting discounts and commissions and estimated offering expenses, are expected to be $40.0 million, assuming no exercise of the underwriters’ option. The Company expects to use the net proceeds to repay $31.41 million of principal outstanding under the senior unsecured convertible promissory note with a face value of $40.0 million issued by the Company to its largest shareholder, Lynrock Lake Master Fund LP (“Lynrock”), on February 18, 2022 (as amended, the “Lynrock Note”), and the balance for general corporate purposes.

In connection with the offering, Lynrock has agreed to convert the remaining $8.59 million of principal outstanding under the Lynrock Note into 1,249,995 ordinary shares. Lynrock has entered into a customary lock up agreement with the underwriters with respect to its ordinary shares, including those to be issued upon conversion of the Lynrock Note, for a period of 75 days following the date of the final prospectus supplement. The Company will have no outstanding indebtedness for borrowed money following the repayment and conversion of the Lynrock Note.

TD Cowen and William Blair are acting as the joint book-running managers, Needham & Company is acting as lead manager and Northland Capital Markets is acting as co-manager, with respect to the public offering of the ordinary shares.

The public offering is being made pursuant to an effective shelf registration statement on Form F-3 previously filed by the Company with the U.S. Securities and Exchange Commission (the “SEC”) and declared effective on April 3, 2025. A preliminary prospectus supplement relating to the public offering has also been, and a prospectus supplement relating to the public offering will be, filed with the SEC. The public offering of ordinary shares is being made only by means of a prospectus supplement and accompanying prospectus. Before you invest, you should read the prospectus in that registration statement, the preliminary prospectus supplement filed on June 24, 2025, the prospectus supplement once available, and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. Copies of the prospectus supplement and accompanying prospectus relating to the public offering may be obtained free of charge at the SEC’s website at www.sec.gov. Alternatively, copies of the prospectus supplement and the accompanying prospectus may be obtained from:  TD Securities (USA) LLC, 1 Vanderbilt Avenue, New York, NY 10017, by email at TD.ECM_Prospectus@tdsecurities.com or by telephone at (855) 495-9846; and William Blair & Company, L.L.C., Attention: Prospectus Department, 150 North Riverside Plaza, Chicago, IL 60606, or by telephone at (800) 621-0687, or by email at prospectus@williamblair.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities described above, nor shall there be any offer, solicitation or sale of such securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. Any offer, solicitation or sale of such securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended.

About Allot 

Allot Ltd. (Nasdaq: ALLT, TASE: ALLT) is a leading global provider of innovative network intelligence and security solutions for service providers and enterprises worldwide. 

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding the size and timing of the public offering, the granting of an option by the Company to the underwriters to purchase additional ordinary shares from the Company, the proposed use of proceeds of the public offering, and the repayment and conversion of the Lynrock Note. These statements are not historical facts but rather are based on Allot’s current expectations and projections regarding its business, operations and other factors relating thereto. Words such as “expect,” “intend,” “believe,” “may,” “will,” “should,” and other words and terms of similar meaning (including their negative counterparts or other various or comparable terminology) are used to identify these forward-looking statements. These statements are only predictions and as such are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those set forth in the “Risk Factors” section of the registration statement and the prospectus supplement for the public offering and the Company’s other filings with the SEC. Any such forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and speak only as of the date of this press release. Allot undertakes no duty to update any forward-looking statements made herein.

Seth Greenberg
Allot
+972 54 922 2294
sgreenberg@allot.com

Ehud Helft/Kenny Green
Allot Investor Relations
+1-212-378-8040
Allot@ekgir.com

FAQ

What is the size and price of Allot's (ALLT) public offering?

Allot is offering 5,000,000 ordinary shares at $8.00 per share, with an option for underwriters to purchase an additional 750,000 shares. The gross proceeds are expected to be $40.0 million before underwriting costs.

How will Allot (ALLT) use the proceeds from the offering?

Allot will use $31.41 million to repay outstanding debt under the Lynrock Note, with the remaining proceeds allocated for general corporate purposes.

What is the impact on Allot's (ALLT) debt structure after this offering?

Following the offering and debt conversion, Allot will have no outstanding indebtedness for borrowed money, as the Lynrock Note will be fully repaid and converted.

What is Lynrock's involvement in Allot's (ALLT) offering?

Lynrock, Allot's largest shareholder, has agreed to convert $8.59 million of remaining debt into 1,249,995 ordinary shares and has entered into a 75-day lock-up agreement for these shares.

When will Allot's (ALLT) public offering close?

The offering is expected to close on June 26, 2025, subject to customary closing conditions.