As a follow-up to my earlier post, I almost have to believe that Gil at ATHX cannot be this foolish, and that there is likely some good news to follow that would raise the share price to a respectable number particularly when there is no dire need to be issuing stock.
Yes it always ugly to raise cash but least Athersys will get it over with in a single transaction WITHOUT issuing any warrants in this case. Plus they did it through William Blair and should get new research coverage. Cytori, on the other hand has a long way to go with Lincoln Park.
WST, if Gil doesn't come up with some good news to get the stock price a lot higher before the offering, his credibility will be finished - and yours will not be so good either after all those glowing articles on ATHX.
Is ATHX undergoing what CYTX had gone through in the past 3 years? Maybe and maybe not - one is for sure: stroke clinical data will not be harvested in the near future and the company may need more money still.
As an update to my last post, ATHX announced that it plans to issue 19.8 million shares at $1.01 per share on 2/1/17 - they are not waiting for any positive news to bolster the stock price before issuance, and without the immediate need for funds, it doesn't look like the CEO can be acting more rashly and inconsiderate of current s/h's - sound familiar!
I believe you are 100% wrong RS !
ATHX PPS has been drifting down since its March 2016 peak. The CEO knows he will need money at some point. Maybe he should have started this a few months back but he is getting the funds and as WST has tried to point out WITHOUT warrants.
Under your scenario they would have followed the CYTX method and waited until nearly broke and the PPS even lower before the process even begins. A proven method for failure.
You're absolutley 100% correct Hedge. I spoke to Gil today and believe me he was not happy selling $20,000,000 at $1.01 per share. He used the word "sucks". He did get it done without warrants and its not like the U/W didn't ask for them. Remember when CYTORI issued shares/ warrants with a repricing mechanism for a better deal if subsequent pricing was better? Some people just don't understand. Investors are down on cell therapy stocks and until there is a big win capital markets aren't going to make capital raising easy. Athersys has raised $25 million in non dilutive capital just for Japan stroke and a fully financed pivotal stroke trial should commence any day.
WST, so why did Gil in early Dec. basically say that a public raise would only be an option of last resort (as opposed to partnering and other funding opportunities) and inferred that it would be an unlikely event?
Its a done deal now. We will have to wait and see if the share price can overcome it and drift higher. Without a significant "breakthrough" in the development of regenemed these companies will continue to languish. My son in law who is an investment banker believes that if we have the "re-patriation" of funds held overseas we may see a rise in the possibility of large drug companies investing in new technology. But they are not stupid and you have to have a compelling argument for the efficacy of your technology to have any chance of being targeted as an investment opportunity. It is hard to be patient when there is so much at stake. Not a game for the faint of heart I am afraid.