Shares of Mink Therapeutics Inc. (NASDAQ:INKT) dropped 21% following the company’s announcement of a potential $50 million at-the-market (ATM) equity offering, sparking investor concerns over dilution.
The clinical-stage biotech firm disclosed in a newly filed prospectus supplement that it has entered into an ATM Sales Agreement with B. Riley Securities, Inc., which will serve as the sales agent for the offering. The agreement enables Mink to issue and sell shares of its common stock—each with a par value of $0.00001—at its discretion over time.
The sharp decline in stock price reflects a common market reaction to large equity offerings, particularly when they pose a risk of diluting existing shareholders’ ownership. Issuing a significant number of new shares can pressure the share price, especially for small-cap biotech companies.
The total number of shares and the timing of sales under the program will be determined based on prevailing market conditions and in coordination with the designated sales agent, according to the company.
While Mink Therapeutics did not provide specific details on how it plans to allocate the proceeds from any stock sales, such capital raises are often used by biotechnology firms to support R&D efforts, clinical trials, and general corporate expenses.
The move comes during a period of financial headwinds for smaller biotech firms, many of which are increasingly relying on public equity markets to fund their operations and sustain pipeline development.
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