Why Cyclacel Pharmaceuticals (CYCC) Shares Are Getting Obliterated
Portfolio Pulse from Henry Khederian
Cyclacel Pharmaceuticals Inc (NASDAQ:CYCC) shares dropped 26.9% after announcing a registered direct offering of 388,200 shares at $3.315 each, and a concurrent private placement to management. Warrants are also being issued, exercisable at $3.19 for seven years. Ladenburg Thalmann & Co. Inc. is managing the offering, which aims to raise about $1.3 million for general corporate purposes. The offering is expected to close on December 26, subject to standard conditions.
December 22, 2023 | 2:36 pm
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Cyclacel Pharmaceuticals' stock price fell sharply due to the announcement of a new stock and warrant offering at a price lower than the current trading price, indicating dilution for existing shareholders.
The sharp decline in CYCC's stock price is a direct reaction to the stock and warrant offering, which typically leads to dilution of existing shares. The offering price is below the current market price, which often results in negative sentiment among investors and a short-term drop in the stock price.
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