Sarepta Therapeutics (NASDAQ:SRPT) stock is taking a hit on Wednesday as the company made an announcement on Tuesday afternoon that sent shares tumbling.
The Cambridge, Mass.-based medical research and drug development business, which focuses on precision genetic medicine for rare diseases, unveiled an underwritten public offering on Tuesday after the bell. The company will be offering more than 2.6 million shares of its common stock at a price of $144 per share to the public.
Plus, Sarepta Therapeutics has also granted underwriters a 30-day option that would allow them to purchase roughly 390,625 shares of SRPT common stock on the same terms and conditions as the initial shares that were sold to the underwriters. The company predicts that the gross proceeds from the offering will be roughly $375 million before deducting the underwriter discounts and commissions, as well as other offering expenses.
The business added that it projects that the offering will be closed on or about March 7, 2019, according to customary closing conditions. Sarepta is reportedly intent on using the net proceeds from the offering for the main purpose of continuing and beginning more clinical trials.
The proceeds will also be used in the commercialization, manufacturing, business development activities and any potential licensing or acquisition of complementary products for the trials.
SRPT stock is down roughly 10.2% on Wednesday following the news. Shares had been falling about 2% after hours Tuesday off the heels of the announcement.