Red Cat Equity Offering Sparks Investor Concerns

Red Cat Holdings has announced a significant $150 million capital raise, triggering a sharp decline in its share price as markets reacted to the potential dilution for existing stakeholders. The drone technology specialist is securing funds to accelerate its strategic initiatives, but investors showed immediate concern over the terms of the offering.

On Thursday, the company revealed plans to issue 15,625,000 new shares priced at $9.60 each?a substantial discount to Wednesday’s closing price of $11.27. This pricing disparity fueled a sell-off that drove the stock down by more than ten percent, with shares closing the session at $10.04.

The equity offering is expected to generate approximately $150 million in gross proceeds. Underwriters have been granted a 30-day option to purchase up to... Read more...