Certara, Inc. (CERT) stock was falling in the pre-market trading following the announcement of a public offering of common stock. CERT stock price saw a downtrend of 9.13% to drop at $31.93 a share at the time of this writing. The stock was also red in the previous trade and went down by 8.51% at closing.
Certara, Inc is playing the lead role in biosimulation that provides software products and technology services to its customers for drug discovery. Let’s dig in to explore recent events of this stock.
Public Offering of Common CERT stock:
CERT stock on September 8, 2021, announced the pricing of a public offering of shares of its common stock. The per-share price of the public offering is $31.00 per share. The offering includes 20.0 million shares of common stock out of which 4.5 million shares were offered by CERT stock. Certain stockholders are offering the remaining 15.5 million shares of the common stock. Stockholders have granted a 30-day option to underwriters for the additional purchase of 3,000,000 shares of common stock.
Certara expects $139.5 million gross proceeds from this offering without deducting underwriter discounts and offering related expenses. CERT stock plans to use net proceeds for general corporate purposes which also include the acquisition. CERT stock will not receive proceeds that will result from the sale of stockholders’ shares. After meeting customary closing conditions, the offering expects to end on or about September 13, 2021.
CERT stock to acquire Pinnacle 21:
Certara stock on August 05, 2021, entered into the definitive agreement in order to acquire Pinnacle 21 for $310 million in cash and stock. CERT stock will pay $250 million in cash and $60 million in shares to the Pinnacle 21 equity holders. The transaction is expected to close at the beginning of Q4 2021 after meeting regulatory approvals and closing conditions. Pinnacle 21’s software helps in validating compliance to the Clinical Data Interchange Standards Consortium (CDISC) standards required by FDA and PMDA.
Financial View of CERT stock:
In the second quarter of fiscal 2021, Certara recorded 15% year-over-year growth in its revenue that amounted to $70.1 million. The cost of revenue was $27.5 million in the recently reported quarter and net loss was $2.9 million. Certara spent $37.3 million in operating expenses. Operating expense increased due to a $5.6 million increase in stock-based compensation and a $2.1 million increase in staff-related costs
Wrap Up:
Announcement of the public offering of shares of the common stock is the obvious reason for falling Certara stock. The acquisition of Pinnacle 21 reflects that management is keen to meet advanced industry standards. In 2021, the CERT stock price has progressed so far by 6.5%.
