GreenPower Motor (NASDAQ:GP) stock is falling on Tuesday after the electric vehicle (EV) company announced the pricing of a public offering for its shares.
GreenPower Motor is selling 1.5 million shares of GP stock, each of which comes with one warrant. Those warrants can be exercised to acquire another share of the company’s stock.
The units in this public offering are being sold for $1.55, and the warrants have an exercise price of $1.82 per share. The warrants can be exercised immediately and will expire in three years.
Additionally, underwriters have a 45-day option to acquire another 5% of shares in the offering. Maxim Group LLC is the sole book-running manager for the public offering.
GreenPower Motor is expecting gross proceeds of $2.3 million from this offering. It will use this money for EV production, product development and general corporate purposes.
What This Means for GP Stock
A public offering increases the total number of outstanding shares on the market. That means it also dilutes the stakes of current shareholders. That’s one reason why GP stock is down today.
The other has to do with the price of the offering. At $1.55 per share, this is a significant discount from GP’s prior closing price of $1.82 per share. As such, it makes sense the stock would drop as a result of the offering.
GP stock is down 35.7% as of Tuesday morning, with more than 141,000 shares traded. The company’s daily average trading volume is about 46,000 shares.
Investors will want to stick around for more of the latest stock market stories.
We have all of the hottest stock market news available on Tuesday! A few examples include why shares of Esperion Therapeutics (NASDAQ:ESPR) and ReAlpha Tech (NASDAQ:AIRE) stock are up today, as well as the biggest pre-market stock movers this morning. All of that info is good to go at the links below!
More Tuesday Stock Market News
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
