I wouldn’t usually take the time to discuss something as mundane as a stock offering and fashion it into a post on Substack, but I felt that today was a suitable opportunity to do that.
The stock issuance was timed perfectly and, in my opinion, the proceeds are significant enough, relative to the organisation, to warrant a quick post.
What Happened?
• Kura Sushi (covered most recently here, and here) announced that they would be issuing 1.1M shares of Class A common stock at $45 per share (pre-market open, that share price was ~$51).
• The net proceeds from this offering would amount to ~$47.1M.
• Should the additional 165K shares be issued (at the underwriter’s discretion), then proceeds would amount to ~$54.1M.
• The proceeds are expected to be used to repay the $17M credit revolver and be allocated to working capital and CapEx.
Why Is This Good?
Common stock dilution is not always great. Pre-announcement, Kura had ~7.4M shares of Class A common stock outstanding, so the additional 1…