Sensio financing scrapped due to “unjustified pessimism” about 3D

On Wednesday, after its stock had slipped to a mere $.19 cents earlier in the week, Sensio (TSXV:SIO) announced it would host a conference call Friday morning to discuss the stock price fluctuations and the cancellation of a previously announced private placement with Northland Capital Partners.

In April, the Montreal-based 3D player announced that, subject to best efforts, it would raise up to $5-million in an offering in which the price per common share would be equal to the highest of 40 cents per common share and the market price (the day prior to pricing) less a 10% discount.

In this morning’s call, CEO Nicholas Routhier said the company canceled the financing because it could not get it done at the minimum floor price of $.40 cents. Routhier said Northland Capital Partner’s efforts were hampered by an “unjustified pessimism” about 3D in the marketplace. This pessimism, he says, does not match the facts about what is actually happening with 3D right now.

Contrary to what many think, said Routhier, 3D TVs are selling. In fact, he says, their adoption is is outpacing the adoption of high-definition televisions by 50% from the moment of their respective launches. The Sensio CEO cited analyst reports forecasting that by 2015, half of all HDTVs sold worldwide will be 3D, a number that amounts to more than 100-million units.

Perhaps more than any other company, Sensio’s stock price has served as a sort of sentiment indicator for the 3D sector. This means 2010 and 2011 were as deflating as 2009 was encouraging. That year, days after the release of James Cameron’s blockbuster Avatar, the company’s share price hit a high of $3.93.

But Sensio, contends Routhier, is a much better positioned company today than it was even three years ago. Some of this has to do with the company’s wide-ranging patents. Then there’s the key relationships the company has carved out with TCL, the largest TV manufacturer in China, and Samsung, which is the the largest in the world. In February, Samsung and Sensio announced they reached a patent license agreement over the SENSIO® S2D Switch. The proprietary SENSIO® S2D Switch, which is protected by US and international patents, enables users to switch viewing mode of a 3D feed from 3D to 2D or between different 3D view modes.

Routhier said Sensio had two reasons for financing, the first was the company’s transactional VOD service 3D Go, which will launch later this fall. The second was the company’s patent initiatives. Routhier said that while a financing would have accelerated these plans, they were both longer term in nature and will not affect the company’s 2012, which in a conversation with Cantech Letter in February he described as “very important and exciting year.”

Shares of Sensio rebounded this week, closing today up 8.3% to $0.325 cents.

Disclosure: Cantech Letter Editor Nick Waddell owns 50,000 shares of Sensio, which he purchased in the open market On Friday, March 2nd and Monday, March 5th.