COMPASS Pathways - launches public offering

đź“Š Investing
1

Hi,

Anyone knows and can explain what that means?

Thank you

2

The main points are summarised in the article you linked. Essentially Compass are issuing more shares. The “problem” for a current investor is this dilutes the value of the company across more shares. The usual impact of this is a drop in the price per share. In this case the drop looks to be about 6 % pre-market.

Here’s a good resource I use regularly for looking up unfamiliar terms: Offering Definition

3

Thank you @random53

Is it issuing more new shares(they divided the company in more shares?) or are the founders releasing more of they own shares to the public?

4

Seems to be issuing more shares.

Here’s the SEC filing: https://sec.report/Document/0001628280-21-007756/#i810980d80479428c89603b1af5f74a1e_25

Outstanding immediately after offering = 39,930,331
Outstanding as of 31 December 2020 = 35,930,331

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5

You Know what they refer when saying:

39,930,331 ordinary shares (or 40,530,331 ordinary shares if the underwriters exercise in full their option to purchase an additional 600,000 ADSs). American Depositary Shares Each ADS represents one ordinary share, nominal value £0.008 per share. The depositary will be the holder of the ordinary shares underlying the ADSs, and you will have the rights of an ADS holder or beneficial owner (as applicable) as provided in the deposit agreement among us, the depositary and all holders and beneficial owners of ADSs issued thereunder. To better understand the terms of our ADSs, you should carefully read the section in this prospectus titled “Description of American Depositary Shares.” We also encourage you to read the deposit agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part.

6

Are you asking what ADS means?

Compass is a UK based company that chose to list via ADS on the NASDAQ exchange. I guess they chose a US exchange over the London stock exchange since they could raise more capital.

There’s nothing special about these new shares compared to the other shares that were already trading.

I only have a basic understanding here so relying on someone to correct me if I’m wrong.