FAST NEWS: BIT Mining Raises $9.3 Million in New Share Sale at Big Discount
The latest: Cryptocurrency miner BIT Mining Ltd. (BTCM.US) announced on Tuesday it has agreed to sell “certain institutional investors” 15.6 million of its American depositary shares (ADSs), as well as warrants to buy another 31.1 million ADSs. It expects to raise $9.3 million from the sales.
Looking Up: The company had $20.9 million in cash at the end of March, meaning the new share and warrant sales will boost that amount by 50% to nearly $30 million.
Take Note: BIT Mining said it will sell the ADSs for $0.60 each, while the warrants will have exercise prices of $0.60 and $0.66. All of those represent a significant discount to the company’s Monday close of $0.78 before the announcement.
Digging Deeper: BIT Mining was founded as an online lottery ticket seller in China, but last year shifted its focus to cryptocurrency mining after China outlawed online lottery ticket sales. The company earns money through its own mining operations, and also by supporting other miners. But BIT Mining and many of its peers have taken a hit from the recent collapse in cryptocurrency prices, reflected by a two-thirds drop in the price of bitcoin from a peak last November. As a result, the company reported a $3.1 million loss in this year’s first quarter, reversing a $3.3 million profit in the year-ago period.
Market Reaction: BIT Mining’s shares plunged 41.8% after the announcement, closing at an all-time low of $0.456. The stock has traded below the $1 level since mid-June.
Reporting by Doug Young
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