The company has completed a private placement of convertible bonds worth 1.0 billion U.S. dollars maturing in 2034. In addition, buyers have the option to purchase an additional 150 million US dollars
After-hours plunge: In direct response to the news, the stock plummeted in after-hours U.S. trading
What will the money be used for?
AST SpaceMobile requires an enormous amount of capital to build its satellite constellation. The proceeds are to be used to drive potential acquisitions or vertical integrations. A portion will also go toward so-called capped call transactionsto at least limit the risk of dilution.
Although the fresh capital secures the long-term financing of the satellite network, the market is reacting extremely sensitively in the short term to the new debt and the potential stock dilution.
