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stoxx

01/30/17 7:27 PM

#284828 RE: revenue_monster #284739

Abuse ATM? Or preparing for positive news?

In fact, among strategic and forward-thinking CFOs within and outside of the life sciences industry, the opposite is true. ATMs are a critical component contained in their financing toolboxes. They understand that ATMs allow them to raise capital much more cost-effectively and with greater control compared to other capital raising methods. Because of the “dribble out” nature of ATMs, they would actually be a poor choice for a company in dire need for financing and without near term value generators or milestones. It is not a “financing at any cost” approach for a company that is in desperate need of raising any amount of capital in order to survive. ATMs are a great tool for companies with a strategic approach to financing. Using an ATM, issuers can cost-effectively raise capital while maintaining flexibility in the timing an pricing of the offering. ATMs can also be positioned in advance of an upcoming liquidity event or MAJOR milestone and take advantage of above average liquidity and a rising stock price that can occur with POSITIVE NEWS. Therefore, ATMs are best considered as an option for a company with a strategic and forward-looking approach rather than for a company in financial distress.

http://brinsonpatrick.com/wp-content/uploads/2012/08/BP-Five-ATM-Misunderstandings.pdf