Why Forza X1 Shares Are Plunging Today

Forza X1 Inc FRZA has priced an underwritten public offering of 5.33 million shares at a price to the public of $1.50 per share.

The offer price represents a 51.9% discount to Forza’s closing price on June 9, 2023.

The gross proceeds from the offering are expected to be approximately $8 million.

The company intends to use the proceeds to develop its manufacturing facility, as well as for working capital and general corporate purposes.

Also, Forza has granted the underwriters a 45-day option to purchase up to an additional 800,100 shares at the public offering price. The offering is expected to close on June 14, 2023.

Forza X1 also announced it received an initial purchase order from OneWater Marine Inc. ONEW indicating intention to purchase 100 units of its upcoming 22-foot electric monohull boat. As Forza gets into commercialization, the order could equate to approximately $12 million in revenue for Forza.

Price Action: FRZA shares are trading lower by 47.7% at $1.63 on the last check Monday.