Mesoblast Announced Sunday Placement And Accelerated Non-renounceable Entitlement Offer To Raise Up To A$97M
Portfolio Pulse from Charles Gross
Mesoblast Limited (NASDAQ:MESO) announced a fundraising effort to raise up to A$97.0 million through a placement and entitlement offer. The company plans to issue up to 120 million new shares at A$0.30 each to raise A$36.0 million in a placement, and up to A$61 million through a 1 for 4 pro-rata accelerated non-renounceable entitlement offer to existing shareholders. The offer includes an institutional and a retail component, with a 'top-up' facility for eligible retail shareholders. Approximately 323 million new shares will be issued, increasing the total shares by 39.7%.
December 04, 2023 | 9:51 am
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Mesoblast Limited is seeking to raise A$97 million through a share placement and entitlement offer, which will dilute existing shares by approximately 39.7%.
The announcement of a significant capital raise through the issuance of new shares typically leads to dilution of existing shares, which can result in downward pressure on the stock price in the short term. The dilution effect of 39.7% is substantial, indicating a significant increase in the number of shares outstanding without a corresponding increase in the intrinsic value of the company.
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