Mullen Automotive (NASDAQ:MULN) has introduced a new 1-for-100 reverse stock split in its updated SEC filing.
The company went through a 1-for-25 reverse stock split in May to keep its stock price above Nasdaq’s $1 bid requirement.
In just one month, MULN stock was shorted all the way back down to current levels, trading at $0.22 at the time of this publication.
Now Mullen Automotive is faced with the same problem as before, it will need to issue another reverse stock split if its to remain listed on the stock market.
Mullen’s annual shareholder meeting is taking place this August and it has introduced a number of dilutive proposals, one being another reverse stock split.
“Proposal 3 — To approve the amendment of the Company’s Second Amended and Restated Certificate of Incorporation to effect a reverse stock split of the Company’s outstanding common stock at an exchange ratio between 1-for-2 to 1-for-100, as determined by the Company’s Board of Directors.”
A 1-for-100 reverse stock split for Mullen is the max ratio, which means an RS could be less than what is being proposed.
A 1-for-100 Mullen reverse stock split would put MULN stock at $22.90.
Coincidentally enough, analysts were giving Mullen Automotive a short squeeze price prediction between $23-$24 earlier this year.
On the other hand, for every 100 shares investors hold will then turn into 1 share.
For the company, it would make sense to go bigger as it will no longer be able to request for a 180-day extension should shares fall below $1 again.
Positive Mullen Developments Today
The Mullen Class Three will soon be starting production in July, will this development be the catalyst to give Mullen Automotive’s share price some traction?
Mullen Automotive announced in May an array of shareholder updates relating to the progress of the company’s projects.
One of which is approaching very quickly.
The company positively stated that in July 2023, the production line for its Class 3 is planned to become operational, with anticipated deliveries and revenue from the Class 3 truck expected in August and September 2023.
Additionally, there will be optional trim and chassis assembly lines to accommodate new models.
Mullen Automotive will be hiring 35 additional plant staff to begin production in July at its Tunica, Mississippi, assembly facility.
While this is positive news indeed, Mullen Automotive will need to prove it can sell these units in big quantities.
“I’m going to let my actions speak louder than words, I’m done speaking, I’m gonna deliver.
And I’m going to let the stock go where the stock’s gonna go. It’s gonna be based on performance, how we perform as a company, as a team.
I think that Mullen has all the right pieces in place.
Not just our vehicle lineup from a commercial perspective, but the factories that we have, the partnerships that we have, the people that we’ve hired,” said Mullen CEO David Michery.
Also Read: Mullen CEO Addresses Big Share Price Plunge in New Interview
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