VolitionRx Ltd. (NYSE:VNRX) shares lost about one-fifth of their value Friday as the Belgium-based life sciences company announced plans to sell 3.5mln shares of its common stock in a public offering at a price of US$2.40.
The developer of blood tests designed to help diagnose a range of cancers said gross proceeds from the offering are expected to be about US$8.4mln before deducting for expenses.
VolitionRx also said it has granted the offering's underwriters a 30-day option to buy up to 525,000 additional shares to cover overallotments, if any. VolitionRx said it expects the offering to close on or about March 13.
Investors apparently were not pleased about the pending dilution of their holdings. They sent VolitionRx shares down 22% in premarket trading, to US$2.30 a share, and the pressure continued into the market open with shares down about 20% to US$2.38.
According to Yahoo Finance, VolitionRx currently has about 26.5mln shares outstanding.
The company said it intends to use net proceeds of the offering "for continued product development, clinical studies, product commercialisation, working capital and other general corporate purposes."
This story has been updated to include the number of shares offered and share price.