Canoo's shares sink after EV maker agrees to sell $52 million in discounted stock

Shares of electrical conveyance startup Canoo were sharply little successful aboriginal trading connected Monday aft the institution said that it has agreed to merchantability discounted shares to rise $52.5 million.

The banal opened Monday astatine $1 per share, disconnected 20%. It's mislaid much than 80% of its worth successful the past 12 months.

Canoo said successful a statement that it has entered into agreements with organization investors to merchantability 50 cardinal caller shares, unneurotic with warrants that springiness the investors an enactment to bargain up to 50 cardinal more. The investors are paying $1.05 per share, and each stock comes with 1 warrant that tin beryllium exercised astatine $1.30 per share.

Canoo didn't sanction the organization investors progressive successful the deal.

The woody terms is simply a important discount, arsenic Canoo's shares closed astatine $1.25 connected Friday. For existent shareholders, the woody besides means important dilution of their holdings, arsenic it volition adhd betwixt 50 cardinal and 100 cardinal shares to the company's existent outstanding stock number of 356 million.

Canoo said successful November that it was moving low connected cash and that it expected to rise funds by issuing caller shares. It had conscionable $6.8 cardinal connected manus arsenic of the extremity of the 3rd quarter.

Canoo said Monday that it volition usage the nett proceeds of the offering for "general moving superior purposes." The institution is expected to study its fourth-quarter results aboriginal this month.

A 5-day illustration of Canoo stock.