AquaBounty (NASDAQ:AQB) stock is taking a beating on Friday after revealing the pricing of a secondary stock offering.
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A press release from the company notes that selling shareholders are offloading 11.2 million shares of their stock in an underwritten public secondary offering. The shares in this offering will be sold for $2.10 each.
That price easily explains why shares of AQB stock are falling today. The company’s stock closed out trading on Thursday at $3.12 per share. That means the offering’s price of $2.10 per share is an almost 33% discount over its latest closing price.
Another thing to note about the offering is a 30-day option for underwriters. This allows them the option of purchasing another 1.68 million shares of AQB stock at the public offering price.
It’s also worth pointing out that AquaBounty won’t see anything from the selling of these shares. That’s due to the secondary offering being made by certain holders of AQB stock and not by the company itself.
On the flip side of that, it also means that AquaBounty won’t be on the hook for any costs associated with the offering. That will be left to the selling shareholders since their the ones making the secondary offering.
AquaBounty says that the secondary public offering of AQB stock will close on Tuesday.
AQB stock is seeing heavy trading on today’s news. This has some 8 million shares changing hands as of this writing. That’s a massive jump from the company’s daily average trading volume of about 743,000 shares.
AQB stock is down 19% as of Friday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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