Why Red Cat Holdings Shares Are Falling Sharply

Red Cat Holdings Inc RCAT shares are trading lower by 27.7% to $0.55 Thursday morning after the company priced a public offering of 16 million shares of its common stock at $0.50 per share, totaling $8 million in gross proceeds.

The company, offering all these shares itself, also granted underwriters the option to purchase up to 2,400,000 additional shares. The offering is set to conclude on December 11, pending standard closing conditions.

Red Cat plans to utilize the funds for general corporate needs, such as working capital, unless specified otherwise in a prospectus supplement.

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According to data from Benzinga Pro, RCAT has a 52-week high of $1.54 and a 52-week low of $0.54.