ASTS Stock Plunges on $100 Million Offering From AST SpaceMobile


  • AST SpaceMobile (ASTS) stock is plunging in early trading after the firm announced that it would sell 32.26 million shares of ASTS stock. 
  • ASTS also disclosed that it would receive investments from three huge companies. 
  • The company intends to use the proceeds from the sale of ASTS stock for general corporate purposes.
ASTS stock - ASTS Stock Plunges on $100 Million Offering From AST SpaceMobile

Source: Andrey Suslov /

AST SpaceMobile (NASDAQ:ASTS) is one of the top trending tickers, and the shares are down around 20% today after AST priced a $100 million offering of ASTS stock. AST is developing “a space-based cellular network.” It specializes in offering “mobile (5G) broadband services” to users in remote areas.

AST also announced today that it would receive investments from AT&T (NYSE:T), Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), and European telecom giant Vodafone (NASDAQ:VOD).

ASTS stock is down about 34% year-over-year and 32% year-to-date.

More About the ASTS Stock Offering

AST will sell 32.26 million shares of ASTS stock for $3.10 each. The deal’s underwriters received an option to purchase another 4.838 million shares.

AST is slated to receive gross proceeds of $100 million to $115 million from the deal. The firm noted that it intends to utilize the funds for general corporate purposes.

Stock offerings make each share less valuable because they greatly increase the total number of shares that are being sold.

AST’s Deals With AT&T, Alphabet, and Vodafone

AST disclosed that it would receive a total investment of $155 million from the three gigantic companies. Vodafone has previously invested in AST, while Alphabet and Google are providing AST with funds for the first time. AST elaborated on the investment in a statement:

“This significant investment in AST SpaceMobile underscores confidence in the company’s technology and leadership position in the emerging space-based cellular direct-to-device market, with the potential to offer connectivity to today’s 5.5 billion cellular devices when they are out of coverage”

ASTS added that it would borrow “up to $51.5 million” from its existing lenders.

According to the press release: “The company also has agreements and understandings with more than 40 mobile network operators globally…” and boasts an investor list of over 30 other major telecoms with a combined “2 billion existing subscriber[s].”

On the date of publication, Larry Ramer 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 Publishing Guidelines.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been SMCI, INTC, and MGM. You can reach him on Stocktwits at @larryramer.

Article printed from InvestorPlace Media,

©2024 InvestorPlace Media, LLC