Shares of Ideanomics (IDEX -5.53%) have fallen today, down by 8% as of 12:40 a.m. EDT, after the company filed a mixed-shelf registration to raise up to $250 million. Shelf offerings allow companies to register new issues of securities for sale at a later time.
The news comes after Ideanomics shares had surged last Friday, when the company announced it had scored an order for 200 electric vehicles (EVs) in China. That deal is worth an estimated $3.2 million and is expected to be fulfilled in mid-July. Originally founded as a video content company that subsequently pivoted toward blockchain-based financial technology, Ideanomics expanded into EVs last year.
Existing shareholders potentially face significant dilution, as a $250 million offering would represent nearly half of its current market cap of around $500 million.
The stock has also now regained compliance with the Nasdaq's minimum price listing requirement, which states that companies must maintain a price of at least $1 for 10 consecutive trading days. Ideanomics shares have remained above $1 from June 9 to June 23 and the company considers the matter closed.
Ideanomics says that it plans to use proceeds from the offering for general corporate purposes, including working capital and potentially repayment of outstanding debt.