MULN - Mullen Automotive announces a 1-for-100 reverse stock split
2023-12-19 13:27:56 ET
Mullen Automotive Inc (NASDAQ: MULN) just announced a 1-for-100 reverse stock split. Its shares are trading at a new low of $0.10 at writing.
Why is Mullen opting for a reverse split?
The EV stock will trade on a split-adjusted basis from December 21 st .
Mullen Automotive is resorting to a reverse stock split in an attempt to remain listed on Nasdaq. According to David Michery – its Chief Executive:
Most sources of capital are not willing to provide financing to the Company if it is no longer on a major national exchange.
Mullen Automotive Inc has recently started delivering its Class 3 electric trucks priced at about $68,000 to Randy Automotive. Still, our market analyst Crispus Nyaga remains bearish on the EV stock ( read more ).
Mullen will have to raise capital in 2024
CEO Michery also told shareholders in a letter on Tuesday that Mullen Automotive will have to raise fresh capital in the coming year to fund operations until it turns cash flow positive.
Delisting from Nasdaq and going to an OTC exchange would have, therefore, “put the company and its shareholders at great risk”, he added.
Note that the California-based electric vehicles company has already enacted a 1-for-9 reverse stock split in August. Before that, it had opted for a 1-for-25 reverse split in May as well.
Factors like high prices, inadequate charging infrastructure, and range anxiety are contributing to a slowdown in EV adoption that’s making things even more difficult for Mullen Automotive Inc.
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