Naked Brand (NASDAQ:NAKD) stock is taking a beating on Thursday after announcing a $100 million private placement.
Naked Brand notes that this private placement is with accredited investors. The offering has the company selling shares of its stock to them at a price of 93 cents per share. Investors are also being given warrants with an exercise price of $1.13 per share.
So why exactly is NAKD stock down on this news? To put it simply, both the private placement price and warrant exercise price are below its stock’s current valuation. Shares of NAKD stock closed out trading on Wednesday at $1.35 per share.
Justin Davis-Rice, CEO of Naked Brand, said this about the private placement news affecting NAKD stock.
“This additional capital will further transform our balance sheet and now with $200 million in cash and no debt, this uniquely positions Naked to pursue strategic acquisitions that provide accretive value to shareholders.”
Naked Brand has been on a wild ride these last few weeks as investors have targeted it for pump and dumps. Check out the following content from InvestorPlace to catch up on what’s been happening to NAKD stock of late.
- There’s a Very Simple Reason Not to Invest in Naked Brand
- Stay Far Away From the Naked Brand Pump
- At This Point, Please Don’t Waste Your Time With NAKD Stock
- Now Is Not the Time to Bet on a Naked Brands Turnaround
- Say a Thank You to Reddit, and Dump NAKD Stock While You Still Can
NAKD stock was down 7% as of Thursday morning.
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.