Interpace Diagnostics Group Inc (IDXG) Prices Underwritten Public Offering At 28% Discount; Shares Tank
Shareholders of Interpace Diagnostics Group Inc (NASDAQ:IDXG) are having a rough morning, after the diagnostic company announced the pricing of an underwritten public offering of 12,500,000 shares of its common stock (or pre-funded warrants to purchase common stock in lieu thereof), and common warrants to purchase up to an aggregate of 12,500,000 shares of common stock. Each share of common stock and, as applicable, each pre-funded warrant is being sold together with a common warrant to purchase one share of common stock at a combined effective price to the public of $1.10. For each pre-funded warrant Interpace sells, the number of shares of common stock Interpace is offering will be decreased on a one-for-one basis.
The common warrants will be immediately exercisable at a price of $1.25 per share of common stock and will expire five years from the date of issuance. The shares of common stock or the pre-funded warrants, and the accompanying common warrants, can only be purchased together in the offering but will be issued separately and will be immediately separable upon issuance. The offering is expected to close on or about Wednesday, June 21, 2017, subject to customary closing conditions.
The public offering would dilute shareholders’ investments and represents about a 28% discount to yesterday’s closing price. As such Interpace shares are currently dropping nearly 35% to $1.00. IDXG has a 1-year high of $19.80 and a 1-year low of $0.70. The stock’s 50-day moving average is $2.10 and its 200-day moving average is $2.60.
The net proceeds to Interpace from this offering are expected to be approximately $12.7 million, after deducting underwriting discounts and commissions and before deducting other offering expenses payable by Interpace, and excluding any proceeds that may be received upon exercise of the warrants. Interpace anticipates using the net proceeds from the offering for working capital, trade payables, payment of legacy contract sales organization (“CSO”) obligations that were not assumed by the purchaser of substantially all of the Company’s CSO business, and general corporate purposes.
Interpace Diagnostics Group, Inc. provides commercialization services to biopharmaceutical companies. It focuses on developing and commercializing molecular diagnostic tests, leveraging the latest technology and personalized medicine for patient diagnosis and management. The company offers commercialized molecular tests which include PancraGen, ThyGenX, and ThyraMIR. PancraGen for the diagnosis and prognosis of pancreatic cancer from pancreatic cysts; ThyGenX, for the diagnosis of thyroid cancer from thyroid nodules utilizing a next generation sequencing assay and ThyraMIR, for the diagnosis of thyroid cancer from thyroid nodules utilizing a proprietary gene expression assay.