Why ChargePoint Stock Crashed on Tuesday
Shares of ChargePoint (NYSE: CHPT) crashed today, down by 10% as of 3:30 p.m. EDT, after the company announced it is conducting a secondary offering. The news comes just a few months after ChargePoint completed its merger with a special purpose acquisition company (SPAC).
The secondary offering is being launched in order for existing shareholders, primarily early venture capital (VC) funds, to sell stock in an orderly fashion. ChargePoint is not issuing any new shares and will not receive any of the proceeds from the deal; this is not a dilutive capital raise. Instead, existing shareholders are collectively selling 12 million shares of stock, while the underwriters have a greenshoe option for another 1.8 million shares.
Image source: ChargePoint.
Source Fool.com
