atai Life Sciences Announces Proposed Public Offering of Common Shares

Rhea-AI Summary

atai Life Sciences (NASDAQ: ATAI), a clinical-stage biopharmaceutical company focused on mental health disorder treatments, has announced a proposed registered underwritten public offering of $55 million in common shares. The company will grant underwriters a 30-day option to purchase up to an additional $8.25 million of common shares.

Berenberg is serving as the sole bookrunner for the offering. 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.

Positive

• Access to significant capital with $55 million potential funding
• Additional $8.25 million available through underwriter option
• Funds allocated to advance clinical development pipeline

Negative

• Potential dilution of existing shareholders' value
• Share offering may put downward pressure on stock price

Insights

Financial Analyst

This $55 million public offering ($63.25 million if the underwriter's option is exercised) represents a significant capital raise for ATAI Life Sciences, potentially diluting existing shareholders by up to 15.8%. The timing of this offering is particularly noteworthy in the current biotech funding environment, where companies are increasingly seeking to strengthen their cash positions amid market uncertainty.

The structure of the offering, with Berenberg as sole bookrunner, suggests a streamlined approach to minimize execution risk. The absence of a fixed price in the announcement indicates the final pricing will be determined through the book-building process, likely at a discount to the current market price to ensure successful placement.

The stated use of proceeds for 'general corporate purposes' and clinical development advancement is standard language but important for ATAI's business model. As a clinical-stage biopharmaceutical company in the mental health space, maintaining sufficient capital for multiple clinical trials is essential. This funding provides operational runway and flexibility to advance their pipeline without immediate dependence on partnership deals or additional financing rounds.

The choice of a public offering, rather than alternative financing options like private placement or convertible debt, suggests management's preference for clean equity capital despite the dilution. This approach maintains financial flexibility without adding debt service obligations or complex security structures that could complicate future financing rounds.

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 commencement of a proposed registered underwritten offering of $55,000,000 of its common shares. atai expects to grant the underwriter a 30-day option to purchase up to an additional $8,250,000 of common shares. All common shares to be sold in the offering will be sold by atai.

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.

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 will be made only by means of a prospectus supplement and the accompanying prospectus which forms a part of the effective shelf registration statement. A preliminary 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 preliminary 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 timing and size 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 is atai Life Sciences (ATAI) raising in its February 2024 public offering?

atai Life Sciences is raising $55 million through a public offering of common shares, with an additional option for underwriters to purchase up to $8.25 million in shares.

What will ATAI use the proceeds from its 2024 public offering for?

The proceeds will be used for general corporate purposes, including working capital and advancing the clinical development of product candidates and programs.

Who is the bookrunner for ATAI's 2024 public offering?

Berenberg is acting as the sole bookrunner for the offering.

When was ATAI's shelf registration statement declared effective by the SEC?

The shelf registration statement was declared effective by the SEC on July 11, 2022.

What is the duration of the underwriter's option in ATAI's 2024 offering?

The underwriter has a 30-day option to purchase additional common shares worth up to $8.25 million.