ZIOPHARM Oncology, Inc. (NASDAQ: ZIOP) is managing to hammer its shareholders in the after-hours session. The company plans to commence an underwritten public secondary offering of its common stock. The good news is that the capital raise is for the company rather than for venture backers as you often see. No financial terms have been set as of yet, so we cannot compare the size to its $362 million market cap listed.
J.P. Morgan Securities is the listed book-running manager and the company is going to grant an overallotment option of up to an additional 15 percent of the amount sold for the 30-day period after the offering.
As far as the use of fund, ZIOPHARM “intends to use the net proceeds from the public offering for the overall development of its drug candidates, including palifosfamide and DNA therapeutics, and for general corporate and working capital purposes.”
Shares rose 2.9% to $4.32 on Thursday but the after-hours session has the stock down 6% at $5.00 against a 52-week trading range of $3.55 to $7.85. If you trust analysts in a small issue like this, the Thomson Reuters consensus price target is listed as $8.67.
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