Shareholders of AFC Energy plc (LON: AFC) have seen their shares crash on Tuesday following a share subscription announcement.
Shares of AFC Energy crashed 10.39% on Tuesday afternoon to 22p. 19/11/19 12:27BST.
AFC Energy are a firm which develop alkaline fuel cells for electricity production, and the firm has headquarters in Cranleigh, Surrey.
AFC pledged to raise £520,000 through a share subscription which will allow the company to fulfill orders following a planned demonstration program in December.
The hydrogen power generation firm issued 2.6 million shares, priced at 20p per share. Interestingly, this saw a 22% discount to the closing price of AFC shares on Monday which would have concerned shareholders.
The shares were raised from a single overseas institutional investor.
“The launch of AFC Energy’s first hydrogen fuelled, zero emission EV charger unit next month means we must now prepare ourselves to respond to orders in a timely manner. The funding announced today supports these activities across both the sales function and supply chain with a view to accelerating our readiness for our deployment in 2020,” said Chief Executive Officer Adam Bond.
Following admission, AFC Energy will have 450.6 million shares issued overall.
Only eight days ago, AFC saw their shares rally after it was reported that internal expectations had been smashed.
The share price last Monday rallied to 28.7p but it seems that the share placing has now dampened investor spirits.
The energy market continues to become more competitive, as i3 (LON: I3E) made a new discovery a few weeks back and Hurricane Energy (LON: HUR) and IGAS Energy (LON: IGAS) exceeded their interim expectations.
Additionally, Cairn Energy (LON: CNE) saw their shares drop after a double blow at the end of October.
It seems that AFC have backtracked on the progress that was initially reported, however AFC have proved to shareholders that they have a way of bouncing from setbacks, which may appease shareholders somewhat in the increasingly saturated market.
