atai Life Sciences Announces Pricing of Public Offering of Common Shares

Rhea-AI Summary

atai Life Sciences (NASDAQ: ATAI) has announced the pricing of a registered underwritten public offering of 26,190,477 common shares at $2.10 per share. The company expects to raise approximately $55 million in gross proceeds before deducting underwriting costs and other expenses.

The offering includes a 30-day option for the underwriter to purchase up to an additional 3,928,571 common shares. Berenberg is serving as the sole bookrunner for the offering, which is expected to close on February 14, 2025. The proceeds will be used for general corporate purposes, including working capital and advancing clinical development of product candidates and programs.

The offering is being made through an effective shelf registration statement filed with the SEC on July 1, 2022, and declared effective on July 11, 2022.

Positive

• Expected to raise $55 million in gross proceeds
• Funds will support clinical development of product candidates
• Successfully secured underwriting from Berenberg

Negative

• Significant shareholder dilution through issuance of 26.19M new shares
• Additional potential dilution from 3.93M share underwriter option
• Offering price of $2.10 may represent a discount to market price

Insights

Financial Analyst

This $55 million public offering represents a significant capital raise for ATAI Life Sciences, but comes with notable implications for investors. The offering price of $2.10 represents an 17.6% discount to the current market price, which is relatively steep even by biotech standards. The issuance of 26.19M new shares (potentially extending to 30.12M with the overallotment option) will result in substantial dilution of approximately 16.5% to existing shareholders.

The timing and pricing of this offering reveal important insights about ATAI's position. Conducting a public offering at this significant discount suggests some urgency in securing additional capital, likely driven by the capital-intensive nature of clinical development in the mental health space. However, securing Berenberg as the sole bookrunner - a respected institution in the biotech sector - provides some validation of the company's prospects.

For the mental health biotech sector, this raise highlights both challenges and opportunities. Clinical-stage companies typically require substantial capital to advance their pipelines, and ATAI's focus on mental health disorders represents a significant market opportunity. The proceeds will provide an estimated 12-18 months of additional runway, based on typical burn rates for clinical-stage biotech companies of similar size.

Looking at the broader implications, while the immediate dilution may pressure the stock price, the strengthened balance sheet positions ATAI to advance its clinical programs without near-term financing concerns. This is particularly important given the current challenging environment for biotech financing, where companies need substantial cash reserves to maintain operational flexibility and negotiate from a position of strength with potential partners.

NEW YORK and BERLIN, Feb. 12, 2025 (GLOBE NEWSWIRE) -- atai Life Sciences (NASDAQ: ATAI) (“atai” or “Company”), a clinical-stage biopharmaceutical company focused on transforming the treatment of mental health disorders, today announced the pricing of a registered underwritten offering of 26,190,477 common shares, at a price of $2.10 per share. atai has granted the underwriter a 30-day option to purchase up to an additional 3,928,571 common shares. All common shares to be sold in the offering will be sold by atai.

The gross proceeds of the offering, before deducting underwriting discounts and commissions and other offering expenses payable by atai, are expected to be approximately $55 million. atai intends to use the net proceeds from this offering for general corporate purposes, including for working capital and to advance the clinical development of its product candidates and programs.

The offering is expected to close on February 14, 2025, subject to customary closing conditions.

Berenberg is acting as the sole bookrunner for the offering.

The securities in the underwritten offering described above are being offered pursuant to an effective shelf registration statement that was filed with the U.S. Securities and Exchange Commission (“SEC”) on July 1, 2022 and declared effective by the SEC on July 11, 2022. This offering is being made only by means of a prospectus supplement and the accompanying prospectus which forms a part of the effective shelf registration statement. A final prospectus supplement related to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. Copies of the final prospectus may be obtained, when available, by contacting: Berenberg Capital Markets LLC, Attention: Investment Banking, 1251 Avenue of the Americas, 53rd Floor, New York, New York 10020, or by telephone at +1 (646) 949-9000, or by e-mail at prospectusrequests@berenberg-us.com.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.

About atai Life Sciences
atai is a clinical-stage biopharmaceutical company aiming to transform the treatment of mental health disorders. The Company was founded in response to the significant unmet need and lack of innovation in the mental health treatment landscape. atai is dedicated to developing novel, evidence-based therapeutics to treat depression, anxiety and other mental health disorders. atai's vision is to heal mental health disorders so that everyone, everywhere can live a more fulfilled life.

Forward-looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, but are not limited to, the uncertainties related to the completion of the public offering, the grant of the option to purchase additional shares, the anticipated use of proceeds from the offering and other statements relating to the proposed offering. There are numerous risks and uncertainties that could cause actual results and atai’s plans and objectives to differ materially from those expressed in the forward-looking information, such as those risks discussed in the section entitled “Risk Factors” set forth in atai’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, in each case, as filed with the SEC, and future reports to be filed with the SEC. These documents contain and identify important factors that could cause the actual results for atai to differ materially from those contained in atai’s forward-looking statements. Any forward-looking statements contained in this press release speak only as of the date hereof, and atai specifically disclaims any obligation to update any forward-looking statement, except as required by law. These forward-looking statements should not be relied upon as representing atai’s views as of any date subsequent to the date of this press release.

Contact Information
Investor Contact:
IR@atai.life

Media Contact:
PR@atai.life

FAQ

How much money will ATAI raise from its February 2025 public offering?

ATAI expects to raise approximately $55 million in gross proceeds from the public offering before deducting underwriting discounts, commissions, and other offering expenses.

How many shares is ATAI offering in its February 2025 public offering?

ATAI is offering 26,190,477 common shares, with an additional 30-day option for the underwriter to purchase up to 3,928,571 additional shares.

What is the price per share for ATAI's February 2025 public offering?

The offering price is $2.10 per common share.

How will ATAI use the proceeds from its February 2025 public offering?

ATAI intends to use the net proceeds for general corporate purposes, including working capital and advancing the clinical development of its product candidates and programs.

When will ATAI's February 2025 public offering close?

The offering is expected to close on February 14, 2025, subject to customary closing conditions.