Exela Technologies (NASDAQ:XELA) stock gained in premarket trading after it announced it was looking to exchange up to 100 million common stock for up to $125 million liquidation preference of its 6.00% series B1 cumulative convertible perpetual preferred stock.
Each $20 worth of common stock is being exchanged for one share of preferred stock that has a liquidation preference of $25/share, worth almost 3x the closing share price on April 15, 2022.
The company will also exchange all outstanding 6.00% Series B convertible perpetual preferred stock for series B1 preferred stock in an ex-dividend transaction.
The plan is to retire all of the shares tendered, meaning 20.6% of its shares. The company is announcing this with plans to apply to list the series B1 preferred stock on the Nasdaq Capital Market.
The offer will close on May 16, 2022.
Is XELA Stock a Buy?
Exela Technologies is a new company growing rapidly since its establishment in 2017. They’re a global business process management solutions company with a niche market. The company aims to improve digital processes by simplifying and accelerating straight-through processing. They work with over 4000+ customers globally and serve thousands of companies worldwide.
Digital mailroom solutions have emerged over the past few years. They are designed to provide a centralized and integrated platform for all aspects of the business, including marketing, customer service, and finance. Exela’s Digital Mailroom offers unique, innovative options for working with package tracking and scanning the mail.
In addition, in the fast-paced world of technology, one company has managed to stand out from the crowd. Exela is a financial institution that has found an alternative to banks in facilitating monetary activities. It offers an alternative service and processes payments differently, focusing on creating a competitive advantage versus traditional banks.
Its financials are improving. And it is becoming more clear how it will reposition itself for the long term to get out of debt. The company has been under a lot of pressure due to heavy debt in the last few years. But they have implemented some plans which are now starting to pay off. Now, the company is looking more optimistic than ever.
Finally, XELA stock is trading at very cheap multiples due to the wider tech sell-off. Baron Rothschild dictated that “the time to buy is when there’s blood in the streets.”
Therefore, if you are an aggressive investor, this could become a great addition to your portfolio.
On the publication date, Faizan Farooque 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.