DraftKings Inc. (NASDAQ: DKNG) said Wednesday morning that it has priced a secondary stock offering announced Monday at $52 a share. The price reflects a discount of 8.4% to the online betting firm’s Tuesday closing price of $56.78.
The company will sell 32 million shares of its Class A common stock, consisting of 16 million shares being offered by DraftKings and 16 million shares offered by selling stockholders. There will be an overallotment option for an additional 4.8 million shares.
Underwriters for the offering are Credit Suisse and Goldman Sachs, who are acting as joint book-running managers.
The company intends to use the net proceeds from this offering for general corporate purposes. DraftKings will only receive the net proceeds from the shares that it is selling. At the offering price, the company expects gross proceeds of $1.7 billion.
This is the company’s second follow-on offering since June, when it sold 40 million shares at $40 per share. In that offering, DraftKings raised approximately $1.6 billion.
DraftKings operates as a digital sports entertainment and gaming company. It provides users with daily sports, sports betting and iGaming opportunities. It is also involved in the design and development of sports betting and casino gaming platform software for online and retail sportsbook and casino gaming products.
Following Monday’s announcement of the offering, the company’s shares dropped nearly 6%. Shares tumbled more than 6% on Tuesday and traded down more than 5% in Wednesday’s premarket.
Excluding Monday’s move, DraftKings had vastly outperformed the broad markets, with its stock up about 496% year to date. Since Monday, shares have dropped nearly 7.5%.
DraftKings stock was last seen down about 6.6% at $5306, in a 52-week range of $9.85 to $64.19. The consensus price target is $51.67.
24/7 Wall St.Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE
Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply
clicking here you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Editors' Picks
