Relay Therapeutics Inc (NASDAQ: RLAY) said it plans to raise $175 million through an underwritten public offering of its common stock, a move that coincided with a roughly 2% drop in the company's shares during after-hours trading Tuesday.
The company indicated that all shares in the proposed offering will be sold by Relay Therapeutics itself. In addition, the filing noted that the underwriters will be granted a 30-day option to purchase up to an additional 15% of the shares included in the offering.
Several investment banks were named as joint book-running managers for the proposed transaction. Jefferies, TD Cowen, Goldman Sachs & Co. LLC and Guggenheim Securities are serving in that capacity, while Raymond James is acting as lead manager.
Relay Therapeutics described itself as a clinical-stage precision medicine company that focuses on developing small molecule therapies for patients with cancer and genetic disease. The company made clear that the offering remains subject to market and other conditions, and stated that there is no assurance regarding whether or when it may be completed or the final size or terms of the offering.
The announcement and associated after-hours share movement reflect the company's immediate disclosure of the proposed capital raise and the mechanics laid out for potential expansion of the deal via the underwriters' option. Beyond the specific managers named and the size and structure of the proposed offering, the filing did not provide additional detail on timing or intended use of proceeds.
Investors and market participants should note the explicit caveats in the company's statement: the offering's completion and its ultimate terms are conditional, and the underwriters have a defined window in which they may exercise their option to increase the number of shares sold.
Bottom line: Relay Therapeutics has filed to sell $175 million of its common stock in an underwritten offering, with a potential 15% increase available to underwriters through a 30-day option; the offering is subject to customary market and other conditions, and no guarantees were provided about its completion or final terms.