Shares of Aveo Pharmaceuticals (AVEO) are sliding after the company announced a 21.74M share spot secondary offering priced at $1.15 per share. The company's plans to raise money by selling shares and warrants come just days after a rumor was circulated of a possible acquisition by an account that now appears to be suspended on the Seeking Alpha website.
CAPITAL RAISE FOLLOWS QUESTIONABLE TAKEOVER REPORT: Aveo Pharmaceuticals' 21.74M share spot secondary was priced at $1.15, with H.C. Wainwright acting as sole book running manager for the offering. This comes only a week after a Seeking Alpha contributor claiming to be a "hedge fund manager" wrote a blog post saying that AstraZeneca (AZN) was on the verge of buying Aveo for about $1B, citing "several large investment banks." The report published on March 27 sent Aveo's share price higher, roughly tripling in value on the stock's highest trading volume since January. That contributor account, dubbed "BlueLion," appears to have since been suspended on Seeking Alpha.
WHAT'S NOTABLE: On March 28, a day after the takeover post, National Securities started coverage of Aveo Pharmaceuticals with a Sell rating and a $0 price target. The firm said the recent share appreciation was "totally unwarranted." Further, National Securities told investors that it expects interim and final Phase 3 overall survival data updates to fail to support a Tivozanib NDA filing. On February 17, Aveo announced the presentation of data from the Phase 3 TIVO-3 study of tivozanib versus sorafenib in refractory advanced or metastatic renal cell carcinoma were presented at the 2019 American Society of Clinical Oncology Genitourinary Cancers Symposium.
PRICE ACTION: In morning trading, shares of Aveo Pharmaceuticals have dropped over 27% to 95c.