Gamida Cell Ltd. (NASDAQ: GMDA) shares plunged by -18.65% on Wednesday after the company announced the pricing of its offering. GMDA stock closed the last session at $1.61 trading 0.33 million shares.
How much has GMDA announced for its pricing?
In a follow-on public offering, Gamida Cell (GMDA) has announced the pricing of 12,905,000 ordinary shares.
- For aggregate gross proceeds of $20 million, the offering will be priced at $1.55 per share before discount and commissions from underwriting, as well as estimated offering expenses.
- Further, Gamida Cell has granted the underwriters an option to purchase 1,935,750 additional ordinary shares for the price of the public offering, less underwriting discounts, and commissions, for a period of 30 days.
- According to the schedule, the offering is expected to close on or about September 30, 2022, assuming all closing conditions are met.
- This offering will be used by GMDA in conjunction with its existing cash, cash equivalents, and trading financial assets to support possible commercial readiness activities for omidubicel, if approved.
- In addition to the continued clinical development of Gamida Cell’s NK product candidates, including GDA-201, the proceeds will also be used for general corporate purposes, such as administrative expenses and working capital.
GMDA’s other efforts?
A separate release announced that GMDA had signed a commitment letter with Highbridge Capital Management, LLC (“Highbridge”).
- Based upon the Commitment Letter, Highbridge has committed to providing a $25,000 senior secured, convertible term loan to GMDA.
- There are certain conditions attached to the Commitment Letter, including the completion of a Gamida Cell equity offering resulting in gross proceeds of at least $20 million, which do not constitute a definitive credit facility.
- There is maturity date of 24 months from the closing date on the Commitment Letter, among other things.
- A quarterly interest rate of 7.50% is also included in the Commitment Letter, subject to an increase to 12.00% upon certain events.
How will GMDA go about financing?
There are certain conditions, and the payment will be made in ordinary shares of GMDA valued at 95% of the volume-weighted average price within a specified time frame. Gamida Cell (GMDA) will be using its own assets and those of its subsidiaries to secure the obligations under the term loan.