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Sarepta Therapeutics, Inc. Message Board

  • dr_mysterio dr_mysterio Dec 12, 2012 5:54 PM Flag

    secondary offering - good or bad?

    Bad because it represents dilution (duh)

    Good because the dilution is tolerable, it was done at the market ($25 - $25.95 range) without warrants (bad things), only 3 – 4 million shares, and raising $75M to $100M.

    Good because some kind of dilution was almost inevitable, the markets hate uncertainty, and this puts the main negative event investors were worried about behind us. It clears the decks for investors who were waiting on the sidelines for the “inevitable” secondary offering to happen. Now they can buy without looking over their shoulders.

    Good because it improves SRPT’s negotiating position: Including some old in-the-money warrants expiring in December, and including the shares they sold with the ATM facility, and including this offering, SRPT should enter the new year with a cash position of ~$150 to $175M. This will put them in a strong negotiating position with potential partners (they no longer NEED a deal), and may even allow them to reach positive cash flow without doing any further equity offerings (!).

    Good because the market says so. After hours, price went from negative to (decent volume) positive. Last AH sale was for $25.65.

    We'll see what tomorrow brings, but I believe the "wurst" is behind us, i.e., SRPT = Chopped Liver no more!

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