These offerings dont happen overnight,they take time to plan,underwriters,bookrunners have plenty of advance knowledge,probably weeks and shop it around to their bigger clients,based on interest in offering i believe they start selling what they dont own yet into the market ,with algos and ecns doing most of the trading,it shouldnt be too hard to stoke the coals with timely buys and much heavier naked sells once momo is generated, and also there is insider leakage,while the offering was planned there must have been meetings going on with bankers and lawyers and the grunts see activity and start guessing at news,buyout or the like and word spreads and yada yada..,either way the pricing at 12 is bordering on criminal,VVUS priced at 22.50 ,many price within 10-15% of recent pps and i am sure the rise to 17+ was artificial to take some of the sting out of the offering forthe longs( ie drop to 14 not so horrible since it was 14 a few weeks ago).
Personally i took a small hit on it this morning,miscalculated on where i assumed pricing to be (14-15 area), a 30% discount happens on the pinks,on the bigboards its supposed to have some logic behind it,lol
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