The stock of Cinedigm Corp (NASDAQ:CIDM) which is a $180 million market capped media content and digital services company found itself in the doldrums during 20th March trading, after it announced the pricing of its follow-up public offering of its common stock. The previously announced 10.2 million shares of Class A common stock public offer has been priced at $2.7 per share.
Discounted Pricing Sends The Stock Sinking Down Further
The pricing represented a 14.5 percent discount over the trading price of the stock on the day of the pricing announcement. This resulted in the share holders of the stock reacting in a knee jerk fashion by offloading their existing shares in the company, with the intention of entering a lower price points after booking profits, or to stay away from the stock of a company, which is undervalued by its own management and board of directors.
Offer Closes On 25th March
The public offer of these 10.2 million, Class A stock was disclosed by the New York based firm on 19th March. The company has retained the services of Piper Jaffary as its manager for this public offering and has allotted an additional 1.53 million shares as a 30 day option to its underwriters, to exercise the purchase of additional shares in the event of an overallotment. The offer is scheduled to be officially closed on 25th March.
$25.5M Mop Up Target
From this exercise the small capped media content provider with a library of nearly 50,000 films and TV serials is hoping to raise close to $25.5 million, which it hopes to use for its corporate operations and go in for an aggressive acquisition spree, with the goal of adding to its revenue stream over the next financial year.