Coherus Biosciences, Inc. (NASDAQ: CHRS) saw its shares jump on Monday after the company announced that it plans to raise up to $150 million in a two tranche private placement. Singapore’s sovereign wealth fund, Temasek, plans to invest the $150 million. It seems the money is much needed — Coherus was nearly a $30 stock to start the year and now trades at about one-third of that.
Keep in mind that prior to Monday’s move the market cap of this company was about $568 million, valuing this potential private placement at just over 25% of the market cap.
Under the terms of the private placement, the first tranche of $75 million in aggregate gross proceeds to be completed and funded by August 31, with 6,556,116 shares of common stock to be issued at an offering price of $11.44 per share.
The second tranche is projected to be funded following receipt of the U.S. Food and Drug Administration’s (FDA) marketing approval for the CHS-1701 pegfilgrastim biosimilar product candidate.
Coherus intends to use the net proceeds from these private placements for additional capital for the completion of development and registration of its pipeline.
Denny Lanfear, Chief Executive of Coherus, commented:
We are very pleased to have the support of a significant investor of Temasek’s stature and reputation as we continue to progress CHS-1701 and the rest of our pipeline. We are gratified to have Temasek as a shareholder as we advance our efforts to bring biosimilar competition to the market, delivering cost savings for the healthcare system and increasing access to essential biologics for patients.
Shares of Coherus were last seen up about 20% at $13.38, with a consensus analyst price target of $7.35 and a 52-week range of $10.80 to $31.98.