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Investing.com -- Oriental Rise Holdings Ltd (NASDAQ:ORIS) stock plummeted 65% after the Chinese tea supplier announced the pricing of a dilutive public offering that includes warrants with potentially significant downward price adjustments.
The company priced its offering of up to 14.8 million units at $0.4681 per unit on a best-efforts basis. Each unit consists of one ordinary share (or one pre-funded warrant) and one common warrant. The common warrants include several features that concerned investors, including a zero-exercise price option allowing holders to receive twice the number of shares without additional payment, and automatic downward price adjustments to 70% and 50% of the initial exercise price on the 5th and 10th trading days after closing.
The offering is expected to raise approximately $6.9 million in gross proceeds before deducting placement agent fees and other expenses. Oriental Rise plans to close the transaction on July 23, 2025, subject to customary closing conditions.
The company intends to use the proceeds for general corporate purposes, working capital, sales network expansion, and production capacity improvements. This includes hiring sales personnel, developing regional sales channels, and upgrading manufacturing facilities.
Maxim Group LLC is acting as the exclusive placement agent for the offering on a reasonable best-efforts basis.
Oriental Rise describes itself as an integrated supplier of white- and black-tea products in mainland China.
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