Shares of Motorsport Games (NASDAQ:MSGM) stock are flying higher after the company announced that it had regained compliance with the Nasdaq’s listing rules. The company was previously in violation for having less than 500,000 publicly held shares and for having a board that wasn’t comprised of a majority of independent directors. Nasdaq also requires the audit committee of any board to be comprised of at least three independent directors.
This morning, Motorsport announced a $3.9 million direct registered offering with shares priced at-the-market (ATM). As part of the agreement, 183,020 shares will be sold at a price of $21.40 per share. The offering is expected to close by Feb. 3, while the proceeds will go towards “private placement for development of multiple games, working capital and general corporate purposes.”
On Jan. 30, the company disclosed that it had entered into a debt-for-equity exchange agreement with majority shareholder Motorsport Network. Motorsport Network has provided Motorsport with a $12 million line of credit, of which Motorsport will repay $1 million in debt.
Meanwhile, Motorsport solved its board problem by appointing two new directors. CEO Dmitry Kozko added:
“With the addition of Nav Sunner in January and Andrew Jacobson in December, joining John Delta as independent directors, the board of directors is reconstituted adding significant talent and resources to our collective experience.”
5 Investors Betting Big on MSGM Stock
Tracking institutional ownership is important, as these large investors provide liquidity and support for stocks. During Q3, only 12 13F filers disclosed ownership of MSGM, a decline of two filers from the previous quarter. Four investors disclosed initiating a new stake during the quarter, while six investors reported liquidating their entire stake. Furthermore, Whale Wisdom reports that 13F filers do not own any options against MSGM. With that in mind, let’s take a look at the top shareholders of Motorsport:
- Motorsport Network: 1.03 million shares. Motorsports’ stake is accurate as of Jan. 30.
- AllianceBernstein: 12,216 shares. AllianceBernstein acquired its entire stake during Q3.
- Vanguard: 6,278 shares. Vanguard sold 158 shares during Q3.
- EMC Capital Management: 5,643 shares. EMC sold 282 shares during Q3.
- Geode Capital Management: 3,228 shares. Geode’s stake remained unchanged during Q3.
On the date of publication, Eddie Pan did not hold (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.