Zoomcar To Raise $9.15 Mn From Institutional Investors

Nasdaq-listed car rental marketplace Zoomcar plans to raise $9.15 Mn via private placement of shares to certain institutional investors.

In a statement, the company said it will use the fresh proceeds to repay nearly $3.6 Mn (INR 30.33 Cr) in outstanding debt to certain institutional creditors, as well as for general corporate purposes and working capital requirements.

The company also said that the $9.15 Mn cash proceeds will also include fees payable to the placement agent and other allied expenses.

The deal will see the startup issue 21.37 Lakh units at $4.28 (around INR 360.65) apiece. Each of these units will comprise a common share (or a pre-funded warrant), two Series A warrants (which can be converted into two shares at $4.03 apiece) and one Series B warrant, with an exercise price of $0.0001 for buying shares that will be decided on the reset date.

As per Zoomcar, the Series A and Series B warrants can be converted after the company gets shareholders’ nod. The Series A warrants will have a term of 5 years, while the Series B warrants will be exercisable until “exercised in full”.

Founded in 2013 by David Back and Greg Moran, Zoomcar operates a one-stop shop platform for renting self-driving cars. It connects car owners with guests, who can choose from a selection of cars for use at affordable prices.

Zoomcar began trading on the Nasdaq in December last year, following a SPAC merger with Cayman Islands-registered Innovative International Acquisition Corp.

Since then, the company has been bracing choppy waters. In June this year, founder after a 12-year tenure. A month later, Zoomcar’s global president Adarsh Menon al the company just six months into the job.

On the financial front, the in the first quarter (Q1) of the fiscal year 2024-25 (FY25) from $28.78 Mn in the year-ago period due to a sharp reduction in its finance costs.

Meanwhile, revenue from services declined 15% to $2.20 Mn in the quarter under review from $2.61 Mn in Q1 FY24.

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