Why the Carbon Revolution (ASX:CBR) share price is frozen

The Carbon Revolution (ASX: CBR) share price will start the day halted after the company provided a $95 million capital raising update.

| More on:
asx share price trading halt represented by stop sign

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Carbon Revolution Ltd (ASX: CBR) share price will start the day halted after a capital raising announcement from the Aussie manufacturer. Carbon Revolution this morning requested a trading halt from the ASX before a major capital raising announcement to fund its latest growth plans.

Why is the Carbon Revolution share price in focus?

Carbon Revolution provided an update on its pro-rata, accelerated, non-renounceable entitlement offer and institutional placement. It comes as the company has decided to commence construction of phase 1 of its first "Mega-line".

The company has secured formal agreements to initiate detailed design and engineering relating to four new OEM (original equipment manufacturer) programs. A "significant proportion" of those relate to electric vehicles, with Carbon Revolution expecting a required 75,000 wheels per annum of additional capacity to meet demand.

That's a significant increase in the company's current production. To date, Carbon Revolution has sold ~40,000 wheels with 6 awarded programs announced by OEMs and in the market.

The Carbon Revolution share price will be one to watch when it resumes trading following the significant update from the Aussie manufacturer. CEO Jake Dingle said, "The award of these new OEM formal agreements validates Carbon Revolution's strategy and our world-class products and technology".

Carbon Revolution's capital requirement to build phase 1 of the Mega-line is ~$47 million. The fully underwritten $95 million equity raise will raise ~$53.5 million, with the institutional placement to raise a further ~$41.6 million.

The equity raising, combined with additional working finance arrangements, should help Carbon Revolution to reach breakeven cash flow.

The Carbon Revolution share price could be on the move when it returns to the boards after the company's news of the raise at $1.60 per share. That represents a 31.9% discount to the last closing price of $2.35 per share on Thursday 22 April.

Carbon Revolution will issue 26.0 million new shares under the placement component. A further 59.4 million new shares will be issued under the equity raising (or 40.6% of Carbon Revolution's existing issued capital).

Should you invest $1,000 in Carbon Revolution right now?

Before you buy Carbon Revolution shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Carbon Revolution wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 7 February 2025

Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Carbon Revolution Limited. The Motley Fool Australia has recommended Carbon Revolution Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Capital Raising

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Technology Shares

Why is this ASX All Ords stock crashing 10% on Friday?

This share is having a tough time. What's going on?

Read more »

A man looking at his laptop and thinking.
Capital Raising

Guess the ASX All Ords stock launching a capital raising at a 52-week low

After failing last month, the struggling company is trying again.

Read more »

Shot of a young businesswoman looking stressed out while working in an office.
Healthcare Shares

Why is the Mesoblast share price crashing 9% today?

What is weighing on this high-flying stock on Tuesday? Let's find out.

Read more »

A bored man sits at his desk, flat after seeing the latest news on the share market.
Technology Shares

Brainchip shares crash 10% on capital raising news

This semiconductor company is raising funds via a put option agreement again.

Read more »

A man slumps crankily over his morning coffee as it pours with rain outside.
Healthcare Shares

Why is this ASX healthcare stock crashing 26% today?

Let's find out what is causing investors to hit the sell button on Monday.

Read more »

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Capital Raising

Guess which ASX All Ords stock just crashed 28%!

What's causing this share to crash deep into the red on Thursday? Let's find out.

Read more »

A man sits in a chair hunched over a laptop and covered head to toe in frozen icicles to represent Envirosuite's trading halt
Capital Raising

Why the Novonix share price is frozen today

Time to refill the cash tank before it runs out.

Read more »

A man slumps crankily over his morning coffee as it pours with rain outside.
Gold

Why is this ASX gold share crashing 22% today?

Let's find out why this gold miner is down in the dumps on Tuesday.

Read more »