Bruker - Preferred Share Offering
Reflections on dilution and the potential playbook
Friends of NFTBC.
A few weeks ago, I wrote that “either something will happen during Q3 or it won’t.” Well… something happened. As feared, Bruker is doing an equity raise.
On Tuesday, BRKR announced a mandatory convertible preferred stock offering and published a prospectus. The deal priced last night. Under its terms, Bruker is issuing $600m of stock plus up to an additional $90m for underwriters to cover over-allotments. On the face of it, there’s no question that it’s an unpleasant dilution for existing shareholders - and even more so than I had feared. But it also means that the covenant issue will be thoroughly resolved and investors can move on from it.
In this post, we’ll go over some of the mechanics of the deal as well what Bruker’s playbook might be from here.
