Marathon Patent Group Inc (MARA) Cashes Out; Shares Take a Hit
Shares of IP firm Marathon Patent Group Inc (NASDAQ:MARA) are tumbling nearly 12% in after-hours trading. The reason? Marathon announced this evening that it will be selling 1,354,546 million shares of its own stock to raise cash.
Each share of common stock is being sold at a price of $5.50 per share.
Added to its current 11.12 million shares outstanding, this offering promises to dilute existing shareholders by 12% — coincidentally, about the same amount that the stock is down this evening.
Another reason investors may be selling off Marathon stock is the price at which these new shares are being offered. At $6.34 a share, Marathon is offering new stock for a price 13% below what its shares cost prior to the offering announcement.
On the other hand, these new shares won’t just raise the share count but they’ll also raise cash. It will help Marathon to shore up its balance sheet by generating as much as $7,450,000 in new capital.
The offering is expected to close on or about December 21, 2017.
Marathon is an IP licensing and commercialization company. It acquires and manages IP rights from a variety of sources, including large and small corporations, universities and other IP owners. The company’s commercialization division is focused on the full commercialization lifecycle which includes discovering opportunities, performing due diligence, providing capital, managing development, protecting and developing IP, assisting in execution of the business plan, and realizing shareholder value.