Exela Technologies Inc. (XELA) stock plunged during current market trading session. Here’s the recent development

Exela Technologies Inc. (NASDAQ: XELA) stock declined by 6.16% in the current market trading session. Exela Technologies is a global pioneer in business process automation (BPA), with patented technology and a global network to deliver digital transformation solutions that improve quality, efficiency, and end-user interaction. Exela serves over 4,000 clients in 50 countries, with more than 60% of the Fortune 100.

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What is happening?

Exela Technologies reported today that revenues from its previously announced $150 million at-the-market stock transaction have increased its cash position by $85 million. Exela Technologies intends to utilize some of the funds from the equity program to decrease its debt and related interest cost requirements, as well as look into methods to invest in its growth, as part of its previously stated strategic strategy. Exela is aiming for a $25 million yearly debt service reduction as a first step.

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Exela Technologies had approximately $205 million in cash and cash equivalents as of June 30, 2021. Exela Technologies also had $75 million in additional borrowing capacity available through a variety of credit arrangements, all of which were pursuant to certain terms and restrictions. Due to the improved liquidity, XELA does not expect to use the extra available borrowing capacity, such as the $53 million available under its $145 million A/R securitization, in the near future.

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Shrikant Sortur, Exela’s CEO, stated,

They are quite pleased by their retail investors’ and shareholders’ massive support, as well as their business’s stable performance. By allowing XELA to fund their development, they will be able to further use their tech-enabled business services model. Moreover, when Exela Technologies implements its planned deleveraging, the anticipated $25 million permanent decrease in annual debt service provides considerable value for equity investors.

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