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Investing.com -- Hyperscale Data Inc (AMEX:GPUS) stock tumbled 9.9% after the diversified holding company announced a new at-the-market equity offering program for up to $125 million in common stock.
The company disclosed that it plans to sell shares through Wilson-Davis & Co., Inc., which will act as the sales agent for transactions deemed to be "at-the-market" offerings. These sales will be conducted through ordinary brokers’ transactions on the NYSE American exchange or at prevailing market prices.
Hyperscale Data intends to use the majority of any net proceeds to acquire Bitcoin and further develop its Michigan data facility. A smaller portion will be allocated to acquiring XRP, the digital asset developed by Ripple Labs, as well as for working capital and general corporate purposes, which may include debt repayment or stock repurchases.
The announcement indicates that management will have "broad discretion" regarding the timing and application of the net proceeds, as the company "cannot predict with certainty all of the particular uses" for the funds raised through this offering.
At-the-market offerings typically allow companies to raise capital by selling newly issued shares into the market at current trading prices, providing flexibility but potentially diluting existing shareholders’ ownership stakes, which likely contributed to today’s negative stock reaction.
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