An e-commerce company's stock is moving higher Wednesday morning. The movement is the result of a reverse stock split. Here’s the details and an update on an acquisition that could change the face of the company.
What Happened: Naked Brand Group NAKD completed a 1-for-15 reverse stock split Wednesday. Shareholders now have one share for every 15 they own.
The reverse split was done to meet a minimum share price required for the company’s acquisition of Cenntro Automotive Corp and Cenntro Electric Group, according to the company.
Related Link: Naked Brand Enters The EV Sector: What The Chart Says Is Next For The Stock
What’s Next: Naked Brand Group announced an acquisition of electric vehicle technology company Cenntro in November. Cenntro has sold and delivered over 3,300 commercial electric vehicles in over 26 countries.
An update issued Wednesday showed that of the shareholders who voted on the acquisition, 96.99% voted in favor of the transaction.
“We are pleased with the strong vote of confidence by our shareholders to approve the acquisition of Cenntro, an early pioneer in artificial intelligent autonomous driving and a leading designer and manufacturer of electric light and medium-duty commercial vehicles,” Naked Brands Chairman and CEO Justin Davis-Rice said.
Davis-Rice said Cenntro is ready to scale delivieres with an estimated 74,800 sales coming in 2023 and revenue of $2.1 billion.
Previous guidance for Cenntro at the time of the acquisition was listed as revenue of $25.3 million in fiscal 2021 with over 1,500 vehicles sold. The company is also guiding for $506 million in fiscal 2022 revenue with 21,500 vehicle sales.
The company expects its acquisition of Cenntro to close by the end of 2021 and anticipates trading as Cenntro Electric Group on the Nasdaq on Dec. 30.
Naked Brand also updated on its finances with an announcement that it does not plan on raising additional capital in the short term and that it is terminating a previously disclosed at-the-market offering for up to $300 million.
NAKD Price Action: NAKD shares trade at $5.96 at the time of writing based on the reverse share price. NAKD shares closed at 48 cents on Tuesday, which would represent a split-adjusted price of $7.20.
The Cenntro iChassis. Courtesy photo.
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