China Jo-Jo Drugstores Announces Sale of 4 Million Shares; Stock Price Falls
China Jo-Jo Drugstores Inc. (Nasdaq: CJJD), an online and offline seller of pharmaceutical and other healthcare products in China, today announced that it agreeds with several institutional investors to issue 4 million shares of common stock. at a purchase price of $2.50 per share.
The deal, to be completed in a registered direct offering, would result in gross proceeds to the company of approximately $10 million.
The shares of Jo-Jo Drugstores plunged 44 percent to $1.74 per share today.
Meanwhile, the company also agreed to issue to the investors warrants to purchase up to 3 million shares of common stock.
Today's announcement came after the Hangzhou-based company recently said it had filed a shelf registration to offer up to $60 million of stock, debt, and other securities. It said in its registration of the shelf offering that the proceeds would be used for general corporate purposes.
Jo-Jo Drugstores currently operates retail drugstores and an online pharmacy. It is also a wholesale distributor of products similar to those carried in its pharmacies and it cultivates and sells herbs used for traditional Chinese medicine.
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