Shopify is capitalizing on a high stock price to replenish its cash reserves with a sizeable share offering.
The Ottawa-based firm closed an offering of class-A subordinate voting shares on Thursday, raising proceeds of $694 million. The company issued roughly 2.2 million shares on the New York and Toronto stock exchanges at a price of $317.50 per unit. (All figures USD.)
The offering was originally priced at $600 million, but underwriters Credit Suisse and Morgan Stanley exercised an over-allotment option to raise an additional $94 million.
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Shopify, which recently struck a $450-million deal to acquire a warehousing and fulfilment company, said in a release that the offering will help strengthen its balance sheet. The proceeds will either be held as cash or invested in short-term, interest-bearing instruments.
Despite flooding the markets with additional shares – a move that tends to dilute value for existing shareholders – Shopify’s stock price was steady on Thursday. Shares were trading up to $331 on the NYSE before settling around $325 by market close.
