Ambow Education Holding Ltd. (NYSE American: AMBO) announced it will issue 1.5 million American depositary shares at $3.98 apiece in a registered direct offering to two institutional investors.
The pricing on the offering was a 21% discount from yesterday's closing level. In response to the news, shares in Ambow tumbled 22% to $3.96 per ADS on Thursday.
The Chinese education services provider will raise nearly $6 million through the offering. The deal is secured by FT Global Capital, Inc.
Ambow said it intends to use the proceeds from the offering for working capital.
Earlier this month, the Beijing-based education provider reported that in the second quarter its revenues declined 8.7% year-over-year to $22 million. Ambow attributed the decrease to the one-month extension of spring semester 2020 at its K-12 schools, as well as the impact of the pandemic.