Astra prepares reverse stock split, looks for to raise as much as $65 million

Spacecraft engine maker and little rocket home builder Astra prepares to perform a reverse stock split at a 1 to 15 ratio, the business revealed in a securities filing Monday.

Astra likewise looks for to raise as much as $65 million through an “at the market” offering of typical stock, the filing stated.

Shares of Astra were little bit altered in after-hours trading from their close at 40 cents a share. The business went public in July 2021 by means of a SPAC offer, at a near $2 billion assessment, prior to the stock started to topple after launch failures and advancement problems.

Astra’s filing stated the reverse stock split is anticipated to occur on or prior to October 2, after its board authorized the strategy July 6. The business formerly described a reverse split as part of its strategy to prevent delisting by the Nasdaq exchange.

A reverse split does not impact the basics of a business, as it is not dilutive to the stock and does not alter the business’s assessment, however it would raise the stock rate by integrating shares. A reverse split can be viewed as an indication a business remains in distress and is attempting to “artificially” improve its stock rate, or it can be considered as a method for a practical business with a battered stock to continue operations on a public exchange. Functionally, a reverse split, typically done as a 1 for 10, would imply a $3 stock, for instance, would end up being $30 a share.