Cosmos Health Inc.’s stock pulled back Monday after the company announced the pricing of a $32.5 million registered direct offering, wiping away Friday’s big gains.
Cosmos
COSM,
stock fell 58% Monday, outpacing the S&P 500 index’s
SPX,
decline of 0.5%.
The Chicago-based pharmaceuticals company has entered into agreements with institutional investors for the purchase and sale of 2,828,320 shares of its common stock in the offering and warrants to purchase up to 2,828,320 common shares in a concurrent private placement. The combined purchase price for one share of common stock and one warrant will be $11.50, the announcement said.
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Gross proceeds from the offering, which is expected to close on or around Dec. 21, will be approximately $32.5 million. The company’s CEO Grigorios Siokas and existing shareholders are participating in the offering.
Cosmos Health shares rocketed Friday after a reverse stock split. The company announced the 1-for-25 stock split late Thursday in an effort to regain compliance with the Nasdaq’s $1 minimum bid price requirement, and it went into effect at the open of trading Friday morning. The company also changed its name from Cosmos Holdings Inc. to Cosmos Health Inc., though its ticker remains the same.
The stock initially plunged Friday before rallying for a 178.9% daily gain to $23.01 amid record trading volume, then fell again in after-hours trading. Executives have admitted in filings with the Securities and Exchange Commission that the company is in danger of not being able to continue for the next 12 months without an infusion of funding.
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Cosmos Health’s stock has fallen 88.6% this year, compared with the S&P 500 index’s decline of 19.7%.