The stock is trading at $9.99 off $1.17 on the day.
Dahlman Rose was one of the second tier underwriters on both the IPO and the iniders secondary.
I'm curious if they got squeezed out of the current offering.
On Tuesday Morgan Stanley re-initiated MCP at overweight.Molycorp Inc. (MCP), owner of the largest rare-earth deposit outside China, fell as much as 12 percent after Dahlman Rose & Co. cut its recommendation to hold from buy following the mining company’s decision to sell bonds and stock.The shares slid 9.2 percent to $9.23 at 9:39 a.m. in New York after trading at its lowest since the company’s July 2010 initial public offering. They have tumbled 82 percent in the last 12 months.
Molycorp, which is working to reopen the Mountain Pass mine in California, agreed to sell 12 million shares at $10 apiece and $360 million of convertible notes. It plans to use the proceeds for operating expenses, working capital, capital expenditures, “and any other cash requirements,” the Greenwood Village, Colorado-based company said today in a statement.
“The size of the capital offering raises questions whether this project will be completed on time and whether the previous operating cost metrics can be achieved in a timely fashion,” Anthony Young, an analyst at Dahlman Rose in New York, said in a note today. “This mine will not ramp up as previously indicated.”...MORE
MS is, along with Credit Suisse, joint bookrunner for the notes offering and MS is sole bookrunner for the stock.
From the book:
...The Borrowed Shares Offering is contingent upon the successful completion of the Notes Offering, and the Notes Offering is contingent upon the successful completion of the Borrowed Shares Offering. However, the Primary Shares Offering is not contingent upon the successful completion of either the Notes Offering or the Borrowed Shares Offering, and the Notes Offering and the Borrowed Shares Offering are not contingent upon the successful completion of the Primary Shares Offering....Got that?
Back in April 2011 Morgan Stanley had a more adolescent love for Molycorp: