Barnes & Noble Education, Inc. (NYSE:BNED) shares are falling after the company announced a short-term shareholder rights plan and new equity investments.
In particular, the company has entered into definitive agreements with the following companies: immersion corporation (NASDAQ:IMMR) and its existing shareholders and strategic partners with information on new equity and refinancing transactions to strengthen their long-term financial position.
After closing in June 2024, Barnes & Noble will receive $95 million in new capital through a $50 million equity investment and a fully backstop $45 million equity capital increase led by Immersion. It turns out.
The transaction is expected to result in a net cash infusion of approximately $75 million, less transaction costs.
The company also plans to eliminate approximately $34 million in debt through the equity conversion of second lien term loans, reflecting the strong support of key strategic partners.
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Barnes & Noble has received a commitment to refinance its existing asset-backed financing facility, providing access to a $325 million facility maturing in 2028.
Separately, the Board of Directors approved the implementation of a short-term shareholder rights plan and declared a dividend of one preferred stock purchase right for each outstanding common share.
These rights are exercisable only if an individual or group acquires 10% or more of the company's common stock, and each right allows the shareholder to purchase one-thousandth of a new series of junior participating preferred shares at the exercise price. can. $5.00.
Investors can gain exposure to stocks through: IShares Microcap ETF (NYSE:IWC) and Invesco FTSE RAFI US 1500 Small Mid ETF (NASDAQ:PRFZ).
BNED price action: Barnes & Noble Education stock is down 68.91% to 0.22 cents as of Tuesday's publication.
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