Why Gates Industrial Corporation Shares Are Diving
Portfolio Pulse from Henry Khederian
Gates Industrial Corporation plc (NYSE:GTES) stock fell by 4.4% after the announcement of a secondary offering of 15 million shares by selling stockholders affiliated with Blackstone Inc. The underwriters have a 30-day option to buy an additional 2.25 million shares. Gates will not offer any shares nor receive proceeds from the sale. The offering will close on December 13.
December 08, 2023 | 4:31 pm
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Gates Industrial's stock price decreased by 4.4% due to the secondary offering of shares by Blackstone-affiliated stockholders, indicating increased supply of shares in the market.
The secondary offering increases the number of available shares in the market, which can dilute the value of existing shares and often leads to a short-term decline in stock price. Although Gates Industrial is not directly selling shares or receiving proceeds, the market typically reacts negatively to such announcements due to potential dilution.
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