Zoomcar Holdings, Inc. (NASDAQ:ZCAR) shares are trading lower on Wednesday after yesterday's stock rally.
The company has priced a $9.15 million private placement to support debt repayment and drive corporate growth.
The aggregate gross cash proceeds are estimated before deducting fees to the placement agent and other offering expenses payable by the company.
Zoomcar intends to use the net proceeds from the private placement to repay approximately $3.6 million of outstanding indebtedness to certain institutional creditors and for general corporate purposes and working capital.
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Last month, the company said it hit a major milestone in the debt restructuring process that is aimed at reducing the company's debt obligations of approximately $31 million out of the total outstanding debt as on June 30.
In connection with the latest private placement, the company is planning to issue an aggregate of 2.137 million units. Each unit will be sold at an effective unit price of $4.28 per unit.
Each unit will consist of one share of common stock (or one pre-funded warrant in lieu thereof), two Series A warrants, each exercisable for one share of common stock at an initial exercise price of $4.03 per share and one Series B warrant at an exercise price of $0.0001 to purchase such number of shares of common stock.
The closing of the private placement is expected to occur on or about November 6.
The company will announce its second-quarter results on November 14.
Yesterday, the company announced a major expansion of its customer support team, doubling its size to provide faster, more efficient assistance for both Hosts and Guests.
Hiroshi Nishijima, CEO of Zoomcar, said, "We've achieved significant profitability improvement in the past few months and have reinvested in customer support expansion to continue our commitment of making Zoomcar a frictionless experience."
According to Benzinga Pro, ZCAR stock has lost over 99% in the past year.
Price Action: ZCAR shares are trading lower by 38.5% to $8.125 at last check Wednesday.
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