Here's Why Fate Therapeutics Stock Jumped Higher Today
Shares of Fate Therapeutics (NASDAQ: FATE) were up 19% to $33.73 at 1:39 p.m. EDT on Tuesday after the company raised at least $214 million through a public secondary offering and a private placement with Johnson & Johnson (NYSE: JNJ).
Fate sold 6,181,562 shares at $28.31 in the public offering, which grossed the company around $175 million. After subtracting underwriting discounts and commissions and other expenses, Fate expects to net about $164.2 million. The underwriters have a 30-day option to purchase an additional 927,234 shares, which would gross another $26 million. Considering where Fate's shares are trading right now, it's highly likely that the option will be exercised.
In addition to the public offering, Fate will also sell $50 million worth of shares to Johnson & Johnson at the same offering price of $28.31. In April, Johnson & Johnson and Fate struck a deal potentially worth more than $3 billion to develop up to four different cancer treatments. As part of the deal, Fate got an option to require Johnson & Johnson to purchase $50 million of shares at the public offering price.
Source Fool.com
