Can anyone tell me why the fuck Mankind which was trading at $2.60 yesterday decide to sell 2ndary IPO of 40 million shares (200 mil diluted outstanding most recent #s) + 30 million of warrants combined for $2? I get they are selling to their parent company but wtf is this shit.
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Because they had $2mm of cash and over $400mm of debt...
You missed the pnt. They were trading at $2.60 but their secondary IPO is at $2.00 per share...
Actually, even worse if you consider the intrinsic value of the warrants which is ~$0.35 per unit... Thats the cost of trying to raise money when you're a biotech company and demand is weak . Although they'll receive no proceeds from the other offering that went to the CEO's holdco, at least that portion was at $2.59 and he will be paying additionally for the warrants.
If you take into consideration that both deals combined sold 80mm shares and raised $187.35mm gross proceeds, the effective offering price per share is $2.34. Unconventional way of looking at it, but makes the capital raise as a whole more palatable from the issuer standpoint.
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