Cardlytics Stock Drops Sharply After Announcing New Capital-Raising Effort
Tuesday, 26 March 2024, 22:41
Cardlytics Stock Plummets Amid New Financing Round
News of a fresh round of financing made many investors rather unhappy. In one of its worst stock market trading sessions of all time, Cardlytics (NASDAQ: CDLX) stock really took it on the chin Tuesday. Investors aggressively sold out of the company, to the point where the digital advertising specialist's shares lost almost 33% of their value. A new capital-raising effort was the reason for the widespread discontent.
New Bond Issue Details
- Cardlytics announced $150 million worth of convertible senior notes maturing in 2029.
- The company offered underwriters an option to buy up to $22.5 million more notes.
- Interest to be paid semiannually until maturity with undisclosed rate and conversion conditions.
Financial Implications
- Proceeds to repurchase existing notes and fund corporate purposes like capital expenditures.
- Potential dilution concerns due to new equity issuance and increased debt burden.
- Market cap below $600 million, raising investor uncertainty and market apprehension.
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