Volta recently closed below 50 cents for the first time as a public company due to cash crunch and the possibility of a stock delisting.
EV charging startup Volta (NYSE:VLTA) saw its shares drop below 50 cents for the first time since its public listing last year. This recent relative stock underperformance could be due to a number of factors affecting the electric car charging company. They include cash crunch as well as the possibility of delisting of the stock.
Volta stock briefly climbed to $13 in 2021 but closed Wednesday down 6.4% at 49.2 cents. In contrast, the startup’s rivals charging electric vehicles gained more than 5% for the day. Rivals performing include Blink Charging Co., Chargepoint Holdings Inc. and EVgo Inc.
Before falling below 50 cents, Volta had notice received With respect to the Trading Share Price Listing Rules from the New York Stock Exchange. According to the NYSE, Volta had an average closing price below $1.00 for 30 consecutive trading-day periods.
Volta will compensate for the drop of up to 50 cents
While the notice from major stock exchanges does not mean immediate delisting of Volta’s stock, the company will have to act fast. The EV Charging Company intends to notify the NYSE within one week of its plan to correct the stock price shortfall and regain compliance with the listing requirements. Volta may achieve compliance at any time up to six months after receipt of the NYSE’s notice.
In the meantime, Volta’s Class A common stock will continue to see listing and trading on the New York Stock Exchange. However, this provision is subject to the Company’s compliance with other NYSE issued listing standards.
Reports on 25 November also said that Volta would consider available options including a reverse stock split. Such options are subject to stockholder approval at or before the company’s next annual meeting of stockholders.
Volta began trading on the NYSE in August 2021 following a merger with a special purpose acquisition company (SPAC, At the time, there was a wave of tech-oriented startups that wanted to go public with their various products and services through SPACs.
Despite Volta’s promising start to its public journey, the company faced problems earlier this year. For example, two of Volta’s top executives and founders abruptly left the company in March. Furthermore, the electric car charging startup reported a $15.6 million decrease in its cash reserves in November. So far, Volta has cut its workforce by more than half in a bid to stabilize its dwindling finances.
Volta
Volta ranks among industry leaders in building a network of electric vehicle charging stations. Furthermore, the startup provides media services to achieve clean energy in the future.
Volta’s operating model consists of providing value to its end users by setting up charging stations with large format digital advertising screens. Many of the company’s charging stations are located close to entrances to popular business locations and serve multiple purposes. Advertisers can precisely target audiences while EV drivers charge their vehicles effortlessly.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to strip crypto stories down to the basics so that anyone anywhere can understand without a lot of background knowledge. When he is not delving deep into crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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