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Shares of Fisker Inc. were knocked lower Friday, after the electric vehicle maker announced intentions to offer additional convertible debt to an existing institutional investor.
The company said it plans to offer $170 million of 0% senior unsecured convertible debt due 2025 to the investor. Given the notes have an original issue discount of about 12%, the offering would result in gross proceeds of $150 million to the company.
The stock
FSR,
dropped 4.8% in premarket trading, putting it on track to snap a three-day win streak.
The stock had run 20.5% the past three days, after plunging 23.9% amid a six-session losing streak to a three-month closing low of $5.31 on Sept. 25.
Fisker said the planned offering is part of an amendment to the securities purchase agreement from July 10, in which the company announced a $340 million convertible note offering, which had the potential for the amount to double to $680 million.
On Friday, Fisker said it may now offer up to an additional $623.3 million in convertible debt as a result of the new securities purchase agreement. That could result in additional gross proceeds of up to $550 million.
Shares of Fisker, which delivered its first EV, the Fisker Ocean SUV, earlier this year, have lost 12% year to date through Thursday, while the Global X Autonomous & Electric Vehicles ETF
DRIV
has rallied 18.5% and the S&P 500 index
SPX
has advanced 12%.
