On Thursday, Performant Financial Corp (NASDAQ:PFMT) made a key announcement with regards to its capital raising efforts but the announcement did not impress investors. The Performance Financial stock tanked by as much as 10% yesterday after the company announced the pricing of its public stock offering.
The company announced that it will offer as many as 10.525 million shares of its common stock for a price of $3.80 each. However, that is not all. The underwriters of the offering have also been given a 30 day option by Performance Financial by way of which an extra 1.58 million shares in the company could be acquired.
Performance Financial is looking to raise as much as $40 million from this offering and it is likely that the proceedings are going to be watched closely by investors. The offering is going to be closed on August 20.
The company has also notified that it seeks to use the proceeds from the stock offering for taking care of its working capital needs and for also other run of the mill corporate expenses. However, investors have not been impressed by the news and it is going to be interesting to see if the stock can make a recovery today.