The9 Limited (NCTY) stock traded at $33.38 which is a 6.99% upward movement at the time of writing. The NCTY stock previously closed at $33.80.
The recent pattern of trading of NCTY stock comes along with the news of The9 Limited announcing that it has entered into an underwritten offering with Maxim Group LLC.
How is The9 limited a diversified company?
The9 Limited (NCTY) is an Internet based company which based in China. The9 has the mission to develop into a high-tech diversified internet company. The company is based in Shanghai. Due to aiming to have a diverse portfolio, NCTY focuses on developing games and also had an exclusive license for the distribution/supply of the game World of Warcraft (WOW) in China. It also produces games for the mobile platform and has a technical consulting service. It was previously known as GameNow.net Limited.
Tapping into the blockchain business
In January 2021, The9 diversified its corporate portfolio by tapping into the blockchain business. It did so by agreeing to a partnership with Gingkoo Tech Company Ltd for providing blockchain technology product development services, through its Singapore-based subsidiary. The9 now provides global enterprise services related to customized blockchain-related projects.
Announced an estimated $125 million worth of ADS offering through Maxim group LLC
The9 Ltd, (NCTY) has announced today a massive stock offering. The company has bought a deal offering of American Deposit Shares. Under this agreement, the underwriter has agreed to acquire 3,765,100 American Deposit Share. Maxim Group is the only book-running manager for this agreement. Furthermore, the agreement also allows the underwriter, warrant to purchase 2,383,825 ADSs at a price of $33.20 per ADS and accompanying warrant.
The9 has basically announced that it is selling more ADRs and warrants to purchase ADRs. This one offering allows the underwriter to have warrants which can be exercised at $36 per ADS for the 3 years term.
The9 has given the underwriters a time limit to purchase up to 564,765 ADSs and this can also be in the form of warrants of up to additional 423,574 ADS. This is a 45-day option but the offering will be closed on 5th April.
What does Tech9 aim to do with $125 million cash on hand?
The9 wishes to develop the businesses which are in the starting phase like its crypto-currency mining. It will require cash to develop these businesses and in order to do so it has now just sold ADRs which will give a gross proceed of approximately $125 million. From this cash-on-hand the NCTY stock will try to expand its operations and it aims to do so until its businesses can generate self-sustaining revenue streams in the future.
Overall the company is completing the vision it has described to become a diversified company. Furthermore, the expansion into cryptocurrency mining is a bold new venture which if operated and managed properly can definitely benefit the NCY stock in the future.