STAF Stock Fell 19.9%: Why It Happened

By Amit Chowdhry ● July 22, 2021
  • The stock price of Staffing 360 Solutions Inc (NASDAQ: STAF) fell 19.9% yesterday. This is why it happened.

The stock price of Staffing 360 Solutions Inc (NASDAQ: STAF) – a company executing an international buy-integrate-build strategy through the acquisition of staffing organizations in the United States and the United Kingdom – fell 19.9% yesterday, going from a previous close of $3.82 to $3.06. Investors responded negatively to Staffing 360 Solutions announcing that it has entered into a securities purchase agreement with several institutional investors for the purchase and sale in a registered direct offering priced at-the-market under Nasdaq rules, of 2,199,132 shares of its common stock at a purchase price of $3.45 per share for gross proceeds of approximately $7.58 million. 

Staffing 360 Solutions has also agreed to issue to the investors unregistered warrants to purchase up to an aggregate of 1,099,566 shares of common stock. And the offering is expected to close on or about July 23, 2021, subject to satisfaction of customary closing conditions.

The company plans to use the net proceeds from the registered direct offering to redeem a portion of its outstanding note due September 30, 2022 to redeem a portion of its Series G Preferred Stock and for general working capital purposes.

The warrants have an exercise price equal to $3.80 per share, are exercisable immediately upon issuance, and will expire 5 years from the issuance date.

H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.