Chembio Diagnostics Inc., a struggling manufacturer of rapid tests for HIV and syphilis, Friday announced plans to raise $12 million by selling more stock to the public.
The Medford-based company, which has reported losses in the last two years, said Monday that it expects to report a loss for the three months ended June 30. Chembio also said its cash balance at the end of last month was about $1.44 million, not including deferred revenue of $819,000.
Chembio said Friday it was offering 2.3 million shares for sale at $6 per share. The offering will close Wednesday.
The company expects to raise at least $10.8 million after paying expenses associated with the stock sale. Executives said the money would be used for “business expansion, working capital and other general corporate purposes.”
Before Friday’s announcement, Chembio had 9.7 million shares outstanding that together were valued at about $70 million.
The stock has climbed $1.74, or 33.5 percent, in the past year to about $7 per share.
The announcement was made before Friday’s stock market opening. Chembio shares closed down 2 cents, or less than 1 percent, at $6.93 on the Nasdaq.
Last year, Chembio reported a loss of $2.4 million compared with a loss of $1.1 million in 2014. Sales for the year fell to $24 million, a decrease of 12 percent from 2014.
Chembio has received a number of grants to develop point-of-care tests for Ebola, malaria, Zika and other diseases. Monday, the company announced that it had received approval to begin selling a Zika test in Europe and parts of the Caribbean.
About 155 people work at Chembio’s facilities in Medford and Holbrook.