Why Gamida Cell Shares Are Falling Today
Portfolio Pulse from Nabaparna Bhattacharya
Gamida Cell Ltd. (NASDAQ:GMDA) shares plummeted after announcing a restructuring agreement with Highbridge Capital Management, aiming to provide financial stability and support for Omisirge's commercialization. The deal involves converting $75 million of debt into equity and injecting $30 million of new capital, making Gamida Cell a private entity wholly owned by Highbridge. The company's shares are expected to be canceled post-restructuring. Gamida Cell reported a net revenue of $1.8 million for FY23 and a reduced net loss compared to the previous year. The company also plans a 25% headcount reduction and will consolidate its operations in Israel.
March 27, 2024 | 1:42 pm
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Gamida Cell Ltd. announced a significant restructuring agreement with Highbridge Capital Management, which includes debt conversion, new capital injection, and the company going private. This move aims to stabilize the company financially and support the commercialization of Omisirge. The company's shares plummeted by 82.5% to $0.06.
The restructuring agreement indicates significant financial distress and a drastic change in the company's structure, leading to a sharp decline in share price. The conversion of debt to equity and the company going private are likely to dilute or eliminate current shareholders' stakes, justifying the negative short-term impact on the stock price.
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