NeoStem, Inc. (NYSE Amex: NBS) priced a public offering of 5,000,000 shares of its common stock at $1.35 per share. NeoStem said it would use the proceeds from the offering to build manufacturing and lab facilities in China and the U.S., then to underwrite stem cell-related R&D projects, and finally to develop and license new pharmaceutical products in China.
NeoStem closed Thursday’s session at $1.62 per share, which means the offering was priced at a 17% discount. However, in Friday’s session, the stock dropped 33 cents to $1.29, wiping out any advantage the new investors enjoyed.
Net proceeds from the offering are expected to be about $5,697,500. NeoStem has granted the underwriters an option to purchase up to an additional 750,000 shares to cover over-allotments, if any.
In October 2009, NeoStem closed its purchase of a 51% stake in Suzhou Eyre Pharmaceutical Co., a company expected to report $60 million of revenue in 2009. As a standalone company, NeoStem reported just $200,000 in revenue during its most recent 12 months of activity. It held $6 million in cash at the end of its last reported quarter.
See our other articles on NeoStem.
Disclosure: None.
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