Shares of E-Trade Financial Corp. fell 18% in pre-market trade Friday as traders re-priced the online broker's stock after the company priced a public offering at a 23% discount to the previous session's close.
Before the opening bell Friday, E-Trade shares were trading for $1.17 a share, down from Thursday's close at $1.43.
The company said it priced a public offering under an existing shelf registration statement of 435 million shares of common stock at $1.10 a share, raising about $478.5 million in gross proceeds. Before the announcement E-Trade had about 572 million shares outstanding.
The company has also granted the underwriters an option to purchase up to an additional 65 million shares of common stock on the same terms and conditions to cover over-allotments, if any.
Disclosure I own some shares to sale at first bounce, a speculation play.
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