ASX 300 tech stock Audinate Group Ltd (ASX: AD8) won't be going anywhere on Thursday.
That's because the leading audio-visual networking developer's shares have been slammed into a trading halt this morning at the company's request.
Why is tech stock Audinate halted?
In its request, Audinate has advised that it has halted its shares so it can undertake a capital raising.
The company has requested that the trading halt remain in place until an announcement relating to the completion of the capital raising or the commencement of trade on Friday.
Why is Audinate raising funds?
As things stand, Audinate has not revealed to the market why it is raising funds nor how much it is seeking.
However, the AFR is reporting that the company is aiming to raise $50 million from investors at $13.00 per new share. This represents a 9% discount to where Audinate stock was trading at yesterday's close.
Unfortunately, the report doesn't explain why Audinate is raising funds, so that remains an unsolved mystery.
But given that the company finished FY 2023 with cash and term deposits of $40 million and recorded positive operating cashflows of $12.4 million, as well as positive free cash flow of $2.5 million in the second half, it certainly wasn't in dire need of a cash boost.
This could be an indication that the company has plans for these funds outside general working capital.
Stay tuned because all will be revealed before the market open tomorrow.
