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Mullen Automotive (NASDAQ:MULN) issued a letter to shareholders in which management reiterated that a reverse stock split was the only way to give the company the best possible chance of regaining compliance with the Nasdaq minimum bid rules.
CEO David Michery said the decision was not taken lightly, but was seen as necessary for the company to survive and prosper, which he noted is in the best interests of all shareholders. He also said Mullen Automotive (MULN) needs to raise capital in 2024 to fund initiatives until such time as it is cash flow positive.
“Most sources of capital are not willing to provide financing to the Company if it is no longer on a major national exchange. Being demoted to an over-the-counter exchange where market making and trading volumes are significantly lower would put the Company – and hence its shareholders – at great risk.”
Mullen Automotive (MULN) traded at $0.10 per share at 12:25 p.m. on Tuesday.