Gig Capital also goes by the ticker symbol $GIK was at one point in time the darling child of the SPAC investor with an optimistic future in the electrical vehicle market but what was once a love affair has now become nothing more than a living nightmare. Since it’s highs in mid February that reached a total of $17 a share, the company has since fallen by over 50% and is now priced lower than it was pre-deal….and it’s getting worse.
Redemption day was yesterday meaning that all pre listing investors in the deal could finally liquidate their positions in the open marker. This has had quite the impact on the stock price of GIK over the past few days and seems likely that its causing enormous downward pressure on the stock. I would look away if I were a GIK investor right now, it’s painful.
Currently GIK is trading at $7.50, meaning that it is currently priced at less than the ticker was trading at pre deal (typically $10 as everyone knows by now). This has gotten some investors worried enough to start asking for the Gig capital to redeem the deal, meaning that they could be given back the capital that is sitting inside the shell company and don’t bother finishing the deal off with Lightning motors.
This is bad news in the long run for the company for many reason, but primarily because it means that there are a lot of headwinds to come as the company tries to claw itself out of this position. If the investor base, which is both passionate and vocal about the stock are beginning to turn on the company then it’s possible that problems may arise in the future.
The only way the deal doesn’t go through is if the shareholders vote against the merger.
Of course, the counter argument would be that in a week or two the true value of Lightning Motors might finally be appreciated by the wider market but that’s yet to be seen.
Alas, don’t take this post as a recommendation to do anything. Be yourself, do what you want to do based on your own analysis.
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