Why is the Swoop (ASX:SWP) share price frozen today?

The telecommunications company's shares have been put on ice for now…

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The Swoop Holdings Ltd (ASX: SWP) share price isn't going anywhere on Thursday. This comes after the telecommunications company placed its shares in a trading halt before market open.

At the time of writing, Swoop shares are frozen at $2.09 apiece.

Why is Swoop in a trading halt?

The Swoop share price was placed in a trading halt this morning pending results in regards to a capital raise.

While no details have been given by the internet provider, several media outlets have indicated what's happening behind the curtain.

According to the Australian Financial Review, Swoop is raising $40 million in an underwritten capital raise. It is believed fund managers received presentations by the company, detailing its intentions to support a number of acquisitions.

Should these deals be completed, it is estimated up to $15 million in additional earnings before interest, tax, depreciation and amortisation (EBITDA) would be added to Swoop.

The capital raise is likely to be offered at a discount of around 10% on the last closing price.

It's worth noting the company has the backing of Fortescue Metals Group Limited (ASX: FMG) boss Andrew 'Twiggy' Forrest.

In addition, Airtasker Ltd (ASX: ART) chair James Spenceley also sits as an independent non-executive chair for Swoop.

Australia's largest wealth management firm, Morgans is said to be the broker and underwriter of the capital raise.

Swoop advised its shares will remain in a trading halt until the release of the announcement or by 18 October, whichever comes first.

About the Swoop share price

Since the company's listing in May 2021, the Swoop share price has accelerated by around 400% from its initial public offering price of 50 cents. Its shares reached a high of $2.46 in September before slightly pulling back.

Swoop has a market capitalisation of roughly $238.73 million, with approximately 171.18 million shares on its books.

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