The shares of Mullen Automotive have plunged by 24% to reach a 52-week low of 26 cents. This drastic decline follows the company’s recent filing of a preliminary proxy statement with the Securities and Exchange Commission. The document discusses the possibility of a reverse stock split, which has prompted concern among investors.
Special Stockholders’ Meeting Scheduled
Objectives Behind the Reverse Stock Split
In determining whether to proceed with the reverse stock split, Mullen Automotive’s board of directors will prioritize maintaining a minimum share price of $1 on the Nasdaq Capital Market. It is crucial for the company to sustain this price without resorting to a reverse stock split. However, if necessary, the reverse stock split will be implemented to regain compliance with a minimum bid price of $1.
Previous Reverse Stock Split
Notably, Mullen Automotive had already implemented a reverse stock split in August, reducing the shares at a ratio of 1-to-9.
As Mullen Automotive navigates these challenges, it remains to be seen how shareholders and the market will respond. The company must carefully consider its options and the potential impact on its stock price moving forward.