The English language training service industry may be a thriving industry in China but the Meten EdtechX Education (NASDAQ:METX) did not have a particularly great time in the markets yesterday as it suffered from an almighty selloff.
The Meten Holding stock collapsed by as much as 57% yesterday as investors reacted to the announcement from the company with regards to the pricing of its underwritten public offering. The public offering consists of common shares as well as warrants which are prefunded for buying more common shares in the company. Before the deduction of discounts to underwriters, commissions and other expenses related to the offering, Meten is expecting to bring in as much as $60 million in the form of gross proceeds.
In this particular offering, Meten is going to offer as many as 200 million common shares at the price of $0.30 each and on the other hand, the warrants are also going to be offered at the same price. Meten Holding stated that it is going to use the proceeds from this offering for the purposes of working capital necessities, capital expenses and for general corporate expenses. It, however, remains to be seen if the Meten stock can stem the free fall in the stock today.