Shares of Regeneron Pharmaceuticals Inc. (REGN) are losing more than 4 percent or $24.16 in Tuesday’s morning trade at $545.75. The stock has traded in a range of $271.37 to $583.54 in the past 52 weeks.
Monday, Regeneron Pharma had announced the commencement of an underwritten public secondary offering of its common stock through which Sanofi intends to exit its investment in Regeneron shares. Sanofi currently owns about 23.2 million Regeneron shares and intends to sell about 12.8 million shares in the public offering. Underwriters will have a 30-day option to purchase an additional 10 percent of the offered shares. Regeneron Pharma noted that the registered offering and share repurchase will have no impact on the ongoing collaboration between the two companies.
Immediately following the close of the secondary offering, Regeneron said it has agreed to repurchase about $5 billion of its common stock directly from Sanofi. The purchase price to be paid by Regeneron will be equal to the net offering price per share after deducting any underwriters’ discount and commission.
Following the offering as well as Regeneron’s $5 billion share repurchase, and assuming that the underwriters fully exercise their option to buy additional shares, Sanofi will have disposed of all of its shares in Regeneron, other than the 400,000 shares it intends to retain.
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