The Zip Co Ltd (ASX: Z1P) share price was trading lower today ahead of the closure of its share purchase plan (SPP).
At Friday's close of trade, the buy now, pay later (BNPL) provider's shares were down 1.01%, trading at $1.47.
Image source: Getty Images
All the important details regarding the SPP
Investors sent the Zip share price in negative territory through the day as time dwindled to be a part of the company's SPP.
On 11 March, Zip advised it had opened its $50 million SPP to eligible shareholders. This followed the company's successful completion of a $148.7 million institutional placement from an array of institutional, sophisticated and professional investors.
The SPP offers retail shareholders the chance to subscribe for up to $30,000 worth of new Zip shares.
Furthermore, the issue price is likely to be a 2% discount on the five-day volume-weighted average price to today.
While this may seem attractive as it is considerably lower than the $1.90 per share taken up in the institutional placement, Zip shares have been on a decline.
Over the month, the company's shares have fallen 33% in value, trading near March 2020 lows when the COVID-19 pandemic hit.
Zip previously noted that the proceeds of the placement and SPP would go towards strengthening its balance sheet.
In addition, it is also looking to shore up funds to execute on the potential synergies from the upcoming transaction. This relates to the $491 million all-scrip acquisition of Sezzle Inc (ASX: SZL).
Zip is expected announce the SPP results on Wednesday 6 April.
Settlement and allotment of the new shares will occur on 8 April, with normal trading commencing on Monday 11 April.
About the Zip share price
Despite making strides to grow organically, the Zip share price has fallen more than 80% in the last 12 months, with a 65% drop since the start of 2022.
Zip commands a market capitalisation of around $985.18 million based on today's share price.
