Yea I was kind of wondering about that myself. usually in a offering, they set the price well below what it is trading at. Although it was trading higher before the announcement. In effect the announcement brought it down, but why didi it drop below the offering price?
Again, my opinion only here, I may be missing something, but here goes:
One, I believe the general market selloff contributed today, just not sure why FGP got hit as hard as it did.
Two, unless they can get this stock up in the next few days, I simply do not understand how they are going to get anyone to buy the new units.
Three, you are correct in that many companies actually do secondary offerrings at a lower price than market. Also, the failure of this may not be a totally bad thing, although I am not privy to the insider workings of FGP, so that is just speculation on my part. Only time will tell.
<<<In effect the announcement brought it down, but why didi it drop below the offering price? >>>
Market conditions. They picked the absolute worst day to announce and commence a secondary, IMO.
We know that MLP's do secondary's periodically...that is life. But, geebus, FGP's luck with this one was pretty bad. Nice price action on Monday, announce secondary, and Tuesday the world markets all tank...so it was a double whammy downdraft for FGP. It'll recover though. The nice distribution will lure buyers.