GRRR Stock Tanks On Pricing $125M Note Offering – Retail Sees A Buying Opportunity Amid The Sell-Off

• In late June, Gorilla struck a $2.5 billion, five-year contract with an unnamed customer to provide compute power, to be supplied from the NeutraDC Batam project.
• The company will initially bring 1,000 B300 GPU servers online for the customer as part of Phase 1 of deployment.
• It expects to earn nearly half of the anticipated revenue once Phase 1 is completed.

Shares of Gorilla Technology (GRRR) slumped on Wednesday after the AI-powered software and infrastructure solutions company announced pricing details for its convertible note offering, through which it plans to raise up to $125 million from investors.

At the time of writing, GRRR stock was down 26%, on track to hit its lowest level in two months, and the top-trending ticker on Stocktwits.

Conversion Price Of GRRR’s Offering

Gorilla said that investors holding a note worth $1,000 will receive 39.2425 ordinary shares at a conversion price of about $25.4826 per ordinary share, which will be subject to adjustment upon the occurrence of certain events.

The initial conversion price represents a premium of about 52% over the stock’s last closing price on Tuesday, the company said. The notes, which are being sold through a private placement, will accrue interest, payable semi-annually in arrears, at a rate of 7.50% per annum.

Through convertible note offerings, companies gain quick access to capital at low interest rates, and investors have the option to convert their notes into equity down the line, potentially benefiting them if the stock price shoots up. Senior noteholders are prioritized in the event of bankruptcy and paid back first.

Additional Capital Will Fund GRRR’s Indonesia Project

The company said it will use the proceeds to add data center capacity at the NeutraDC Batam project in Indonesia and to buy the necessary equipment. Anything leftover will be utilized for general corporate purposes.

In late June, Gorilla struck a $2.5 billion, five-year contract with an unnamed customer to provide compute power, to be supplied from the NeutraDC Batam project. At the time, the company said banks had already offered to cover 70% of the project costs.

By bringing 1,000 B300 GPU servers online, a process expected to be completed by September this year, the company expects to earn roughly half of the anticipated revenue.

What Do Retail Traders Think About GRRR?

On Stocktwits, retail sentiment toward the stock turned ‘bullish’ from ‘bearish’ over the last 24 hours.

One bullish user on the platform called sees the stock's sell-off as a buying opportunity.

Another user on the platform highlighted that the company’s fundamentals are strong.

GRRR stock has gained 13% so far this year, but has declined more than 40% over the last 12 months.

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