Greenwave Technology Solutions, Inc. announces $7 million offering

Greenwave Technology Solutions, Inc. (NASDAQ:GWAV), a wholesale metals service center with a market capitalization of $10 million, has entered into agreements for a registered direct offering and concurrent private placement expected to raise approximately $7 million.

According to InvestingPro data, the company has been quickly burning through cash, making this capital raise crucial for its operations. The announcement made today, Tuesday, follows the company’s entry into a securities purchase agreement with institutional and accredited investors on Monday.

The Chesapeake, Virginia-based company will issue 21.1 million shares of common stock at $0.3337 per share, along with warrants to purchase an equivalent number of shares. These warrants, exercisable at the same price, will become active upon stockholder approval and will expire five years from that date.

The warrants may be exercised on a cashless basis if certain conditions are met, and the company is obligated to register the resale of the warrant shares. The offering price represents a significant discount to the stock’s current trading price of $0.45, though InvestingPro analysis indicates the stock is currently undervalued based on its Fair Value assessment.

The net proceeds from the offering are intended for debt satisfaction and working capital purposes. With a current ratio of 1.52, the company’s liquid assets currently exceed its short-term obligations. The transaction is expected to close on or about today, subject to customary closing conditions. Discover more financial insights and 13 additional ProTips for GWAV with an InvestingPro subscription.

Dawson James Securities, Inc. is serving as the placement agent for the offering. The company has agreed to pay the placement agent a cash fee of 6% of the gross proceeds and issue warrants to purchase up to 2.11 million shares at an exercise price of $0.417125 per share.

The issuance of the shares in the registered direct offering will be conducted under Greenwave’s shelf registration statement, which became effective on April 28, 2023. The accompanying warrants, along with shares underlying the warrants, are offered through a private placement exempt from registration under the Securities Act of 1933.

This report is based on statements from a press release and does not constitute an offer to sell or a solicitation of an offer to buy any securities. The offering of securities is made only by means of a prospectus supplement and related prospectus.

In other recent news, Greenwave Technology Solutions, Inc. has been making notable strides in the metal recycling industry.

The company has announced the expansion of its Scrap App platform, which uses artificial intelligence to automate the buying process of junk cars, into 27 new markets. This expansion is backed by one of the largest junk car buyers in the United States and is expected to boost the company’s presence in the auto recycling sector.

Greenwave has also revised its revenue projections for fiscal year 2025 to $47-50 million, following the implementation of tariffs on imported steel, aluminum, and copper. The company’s revised revenue guidance suggests a growth of 10-20% with gross profit margins expected to be in the range of 40-45%.

The company has secured an exclusive contract to become the sole scrap metal recycling service provider for Virginia Beach, Virginia’s most populous city. This new agreement is expected to generate over $500,000 in annual revenues.

Greenwave has entered into a financial agreement to bolster its rare earth metals recovery and monetization efforts, raising $4 million through a securities purchase agreement with institutional and accredited investors. This move aligns with Greenwave’s long-term objectives and potentially reduces negative stock price movements.

Finally, Greenwave has agreed to sell approximately 7.5 million shares of common stock and accompanying warrants to raise $4 million in gross proceeds.

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