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SLINGERLANDS, N.Y. - Hydrogen solutions provider Plug Power Inc. (NASDAQ:PLUG), currently trading above InvestingPro’s Fair Value estimate and burning through cash with negative free cash flow yield of -18%, announced Wednesday it has secured approximately $370 million in gross proceeds through an agreement with an existing institutional investor for the immediate exercise of outstanding warrants.
The transaction involves the exercise of warrants issued in March 2025 to purchase 185,430,464 shares of common stock at $2.00 per share. Upon completion, the investor will receive 31 million shares of common stock and pre-funded warrants to purchase up to 154,430,464 additional shares. The company’s stock has shown significant volatility, with a beta of 2.24 and remarkable returns of over 245% in the past six months.
As part of the agreement, Plug Power will issue new warrants to the investor to purchase 185,430,464 shares at an exercise price of $7.75, representing about a 100% premium to the company’s October 7 closing stock price. These new warrants will be exercisable after stockholder approval to increase authorized shares and will expire on March 20, 2028.
"Plug Power intends to use the net proceeds from this offering for working capital and general corporate purposes," the company stated in its press release.
The transaction, expected to close around October 9, could potentially generate an additional $1.4 billion in gross proceeds if the new warrants are fully exercised, though the company noted no assurance can be given that any will be exercised.
Oppenheimer & Co. Inc. is serving as lead financial advisor, with BTIG LLC, Clear Street LLC, Craig-Hallum Capital Group LLC, H.C. Wainwright & Co. and Roth Capital Partners acting as co-advisors.
Plug Power, which has deployed over 72,000 fuel cell systems and 275 fueling stations, operates hydrogen production plants in Georgia, Tennessee, and Louisiana with a combined capacity of 40 tons per day. Despite its operational scale, the company faces profitability challenges with a gross profit margin of -66.5%. Get deeper insights into PLUG’s financial health and 16 additional ProTips with InvestingPro’s comprehensive research report.
In other recent news, Plug Power has announced significant leadership changes, naming Jose Luis Crespo as the new Chief Executive Officer. Crespo, who has been with the company since 2014, will officially take on the CEO role in March 2026 after serving as President starting October 2025. Concurrently, Andy Marsh will transition to Executive Chair of the Board, and George McNamee has been appointed as Lead Director. In terms of stock analysis, Clear Street has downgraded Plug Power from Buy to Hold, citing valuation concerns with a price target set at $3.50. Meanwhile, Oppenheimer has maintained its Perform rating as the company undergoes organizational changes. On a positive note, H.C. Wainwright has raised its price target for Plug Power to $7.00, reflecting increased electricity prices across the U.S. These developments highlight the company’s ongoing transformation and the varied analyst perspectives on its future performance.
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