What happened
Investors were more than willing to take a ride with Bicycle Therapeutics (BCYC 0.93%) on Thursday. The U.K.-based biotech saw the price of its American Depositary Shares (ADSes) surge more than 19% higher on the day; news about a new round of capital raising was the cause of the rally. By comparison, the S&P 500 index inched less than 0.9% forward that day.
So what
After market hours on Wednesday, Bicycle announced it was seeking to raise gross proceeds of around $200 million through a new ADS offering. It soon followed this up with the specifics on pricing and ADS count; just over 9.4 million of the securities will be sold at a price of $21.25 apiece. Investors have the option of purchasing nonvoting ordinary shares in lieu of ADSes.
These are clearly hot items, as Thursday's investor bull run powered the ADSes already on the market past the $26 level.
Bicycle said that the offering is anticipated to close on or about this coming Monday, July 17. The biotech has granted the issue's underwriters, led by Goldman Sachs, Jefferies, and Leerink Partners, a 30-day option to collectively purchase up to more than 1.4 million ADSes or ordinary shares at that $21.25 price.
Now what
Bicycle said it expects to reap just over $187 million in net proceeds to, sensibly, fund its investigational programs, in addition to other research and development activities. It will also utilize them for unspecified "general corporate purposes," plus certain types of financial instruments including U.S. or U.K. government debt obligations.
