Why Fisker Stock Jumped Friday
Investors are cheering electric vehicle start-up Fisker's (NYSE: FSR) announcement Friday morning that it would redeem its outstanding warrants. Just after the market open at 9:35 a.m. EDT, Fisker shares were up more than 5%.
Fisker announced that as permitted under the terms of the warrant agreement made with its special purpose acquisition company (SPAC) suitor, the company will redeem all outstanding warrants to purchase common shares. In a move that is deemed shareholder friendly, the company is doing it on a cashless basis. This means that full new shares will not be converted directly from those outstanding warrants, and instead warrant holders will have to surrender a portion of a share in place of cash. The bottom line for existing shareholders is the number of shares outstanding will be lower than many had anticipated.
Source Fool.com
