On May 9, 2022, Exela Technologies Inc. (XELA) said that it has executed a financing commitment from PNC Bank. Consequently, the stock shot up by 28.46% in the regular trading session to trade at $0.3701 a share. Ultimately, the upsurge culminated in corrections in the following session. Thus, XELA succumbed to corrections in the after-hours as suffered a decline of 8.13% to shed its gains. Hence, the stock was then trading at a value of $0.3400 per share.
Moreover, the company will be posting its Q1 2022 financial results today, May 10, and the conference call will be held at 11:30 a.m. Eastern Time. XELA’s executive chairman Par Chadha and Chief Financial Officer Shrikant Sortur would be hosting the call and discussing the results.
XELA’s Financing Commitment from PNC
The three-year financing commitment from PNC Bank is executed for replacing the company’s existing securitization facility. Expected to close on or before May 31, 2022, the facility will offer up to $150 million in committed financing.
As a business process automation company, it has seen a major amount of interest amid the continued growth of the tech sector. Therefore, a huge plus of this facility is the fact that it will allow the company to lower its annual interest by $6 million based on an initial interest rate of roughly 4%. Furthermore, this facility should also help XELA to have access to more capital and the repayment of certain debt obligations.
A Quick Look at XELA
While the company has continued its progress with strategic investments, partnerships, contracts, and management team strengthening, XELA has been in non-compliance with Nasdaq since last year. A steep decline in its share price led to its minimum bid price deficiency as its shares are now trading below $1. In order to increase its share price and regain compliance with Nasdaq before August 8’s deadline, the company was supposed to vote on a reverse split. But recently, it canceled the Special Meeting of stockholders, which was scheduled for May 3, to vote on the reverse split.
It seems the company is evaluating other options before considering the reverse split again, as it still has an option for further 180 days to regain compliance.
Conclusion
Following a $150 million financing commitment with PNC Bank, XELA surged up on Monday only to fall under corrections. Thus, the uptick concluded in corrections for the stock before it declares its financial results today.
