Gain Therapeutics (NASDAQ:GANX) stock is falling on Friday following the pricing of its shares in a public offering.
This public offering has Gain Therapeutics selling 7.11 million shares and pre-funded warrants for 1.03 million shares. The shares are being sold for $1.35 each with the warrants having the same price minus $0.0001.
The pre-funded warrants in this offering are exercisable immediately after being issued. They have an exercise price of $0.0001.
Gain Therapeutics is also offering underwriters the option of acquiring another 1.22 million shares in this public offering. Titan Partners Group is acting as the sole bookrunner for this offering.
Gain Therapeutics expects to raise $11 million in gross proceeds from this public offering. It will use these funds to continue the clinical and nonclinical development of GT-02287. This is its lead product candidate to treat neurodegenerative diseases. The money may also be used for general corporate purposes.
How This Affects GANX Stock
With this public offering, Gain Therapeutics is increasing the total number of outstanding shares. Doing so dilutes the stakes of current investors in the biotechnology company. That’s one reason why the stock is down today.
Another is the pricing of shares in the offering. The $1.35 price is well below the stock’s previous closing price of $1.89 per share. It makes sense this discount would drop the price of currently traded shares, too.
GANX stock is down 25.4% as of Friday morning.
Investors will want to stick around for more of the most recent stock market news!
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On the date of publication, William White did not hold (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.
