Richtech Robotics Slides 6.5% on $100M Stock Offering Plan
The robotics firm's announcement of an at-the-market equity program sparks investor concerns over potential shareholder dilution.
Shares of Richtech Robotics Inc. (RR) fell 6.5% on Thursday after the company revealed plans for a $100 million at-the-market (ATM) equity offering. The stock closed at $3.10 as investors reacted to the potential for significant dilution of existing shares.
The agreement allows Richtech to sell shares of its Class B common stock directly into the open market through agents Rodman & Renshaw LLC and H.C. Wainwright & Co. This method provides the company with a flexible way to raise capital over time, funding general operations and strategic expansion plans. However, the introduction of a large number of new shares can reduce the value of those currently in circulation, a prospect that weighed on the stock Thursday.
Under the terms, Rodman & Renshaw will act as the lead agent and receive a 3% commission on the gross proceeds from any sales. While Richtech is not obligated to sell any specific number of shares, the program's announcement was enough to trigger a sell-off on nearly 3.5 times the average trading volume.
The move comes at a time of high interest in the company, which develops robots for the hospitality and healthcare sectors. Despite the day's decline, Richtech's stock has performed strongly, gaining over 22% year-to-date and more than 128% over the past 12 months. This contrast highlights the market's sensitivity to financing activities that could impact shareholder equity, even as the company pursues growth initiatives, such as its recent adoption of Nvidia’s Jetson Thor robotics platform.