Party City Holdco Inc (NYSE:PRTY) stock was down today following news of a secondary stock offering.
Party City Holdco Inc announced that some of its secondary stockholders are going to be selling 10 million shares of the company’s common stock. The company points out that it won’t receive any funds from this transaction as it isn’t selling any of the PRTY stock.
When the secondary sellers have completed their selling of the PRTY stock, Party City Holdco Inc will be repurchasing some of it. The company says that it has plans to repurchase 2.5 million of the shares that are being sold.
Party City Holdco Inc says that it will be paying the same per-share price for the stock being sold as the underwriter of those selling the stocks. PRTY says that it will be using cash on hand as well as funding from its revolting credit facility. Goldman Sachs & Co. LLC is acting as the underwriter for the offering.
Party City Holdco Inc notes that the secondary selling of PRTY stock is in connection to its shelf registration statement for its common stock. This statement went into the effect with the U.S. Securities and Exchange Commission on Sept. 30, 2016.
Party City Holdco Inc is a retail company that deals in supplies for parties and other special events. The company sees most of its business during October as customers prepare for Halloween. This has expanding its store count roughly 50% with temporary locations.
PRTY stock was down 9% as of noon Friday.
As of this writing, William White did not hold a position in any of the aforementioned securities.