San Diego-based Cidara Therapeutics Inc. is looking to raise about $120 million in gross proceeds from a registered direct offering of its common shares.
The offering will be led by Biotechnology Value Fund LP and certain affiliates, with participation from other new and existing investors, including the company's president and CEO, Jeffrey Stein.
Cidara will conduct the transaction in three closings, with the company issuing 10,638,297 common shares at $4.70 apiece in the first closing to raise about $50 million gross proceeds. In a concurrent private placement, the company is offering warrants priced at 12.5 cents to buy up to a total of 12.5 million additional common shares.
In the second offering, Cidara will sell up to an additional $50 million common shares to the major purchasers who bought at least $1 million of common shares in the first tranche's closing.
The company may conduct an optional third tranche five trading days after the second closing to sell up to an additional $20 million of common shares. Cicada may also offer series X convertible preferred stock instead of common shares to purchasers in the offering.
In another private placement simultaneous with the third closing, Cicada will sell warrants at 12.5 cents apiece to buy a total of up to 2.5 million common shares. Each warrant is exercisable immediately for $6.81 per share.
The warrants issued in the two private placements have a five-year term.
Closing of the first offering is expected to occur May 23, subject to customary closing conditions.
Citigroup Global Markets Inc. and Cantor Fitzgerald & Co. are acting as co-lead placement agents for the offering on a "reasonable best efforts" basis.