Mullen Automotive (NASDAQ:MULN) Stock Nears $1 After Filing to Resell 85 Million Shares
Mullen Automotive (NASDAQ:MULN) stock is once again approaching the crucial $1 mark, despite undergoing three reverse stock splits in 2023 — 1-for-25, 1-for-9, and 1-for-100, resulting in a cumulative ratio of 1-for-22,500. Year-to-date, MULN stock is down by 91% and 99% year-over-year.
On Friday, Mullen announced plans to resell up to 85 million shares upon the conversion of notes and exercise of warrants, potentially diluting the value of existing shares. While Mullen won’t receive proceeds from the resale, it could earn up to $19.8 million if all warrants are exercised for cash, which would be used for general working capital.
The top three selling stockholders are Esousa Holdings, JADR Capital, and Ault Lending, with Esousa holding the largest share of 54.64 million shares to resell, followed by JADR at 20.02 million and Ault at 5.03 million.
Mullen has attributed its stock decline to naked short selling and market manipulation, leading the company to retain legal assistance last July. The increase in shares outstanding, from 5.88 million at the start of the year to 24.85 million currently, has contributed to dilution and the stock’s decline.
In conclusion, the ongoing challenges faced by Mullen Automotive, including dilution from stock resales and market manipulation, have led to a significant decline in stock value. Investors should be cautious when considering investing in MULN stock due to these factors.