WKHS stock is moving up sharply on Friday after Workhorse Group Inc (NASDAQ:WKHS) said that it has entered into a $41 million financing agreement with an institutional lender.
One of the companies that has been in the news for a variety of reasons over the past few months is the electric vehicle manufacturer Workhorse Group. Today, the company made a major announcement that has significant implications with regards to its finances. It announced that it has managed to secure a financing agreement worth $41 million in the form of senior convertible notes. The financing came from an institutional lender, and the development will, no doubt, have highly positive implications for the company.
Workhorse stated that some of the money will be used to take care of the company’s current working capital needs. However, more importantly, the company has also revealed that the current debts with Marathon Asset Management are going to be repaid.
The development was well received by the market, and WKHS stock soared by as much as 8% to $2.60 in early trading this morning.
The Chief Executive Officer of Workhorse Group, Duane Hughes, said, “This financing serves the dual purpose of providing us with greater flexibility in running our business as well as an additional runway to execute on our near-term objective of delivering electric delivery vehicles at scale.”
This news comes as the latest in a round of good news revealed by Workhorse. The company revealed in its third-quarter results that it has managed to ink a number of partnerships. The partnerships are meant to properly monetize Workhorse Group’s intellectual property in the drone and electric truck space.
In the third quarter, the company’s sales declined to $4,000 from $11,000 in the prior-year period. Despite the drop in sales, Workhorse actually managed to sell its vehicles at a higher price from the previous quarter.
The company explained that sales dropped so drastically because Workhorse is now moving onto next-generation vans, and the migration into this platform has not been cheap.
WKHS stock is one of the biggest gainers in 2019, with a jump of 340% year-to-date.
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