Redfin Shares Slump as It Sells $110 Million in Stock
Redfin (NASDAQ: RDFN) will collect $110 million from the sale of its stock, but investors aren't exactly welcoming the cash infusion.
The online real estate brokerage announced Monday that it has agreed to sell the stock to Durable Capital Partners, a privately held investment firm. For its money, Durable will receive $70 million worth of Redfin common stock at $15.61 per share, and $40 million in convertible preferred stock.
The latter security is convertible into Redfin common stock; the conversion price is $19.51 per share if the buyer exercises its option. But it will convert automatically after three years if and when Redfin's common shares close above $27.32 per share for 30 consecutive trading days. If neither of these events occur, the preferred stock is to redeem on Nov. 30, 2024, either in common stock or cash as per the buyer's choice.
Source Fool.com
