MiddleBrook falls on financing plans

MiddleBrook (NASDAQ:MBRK) fell $1.55 (50%) to $1.52 on Wednesday after announcing an agreement with Equity Group Investments (EGI) to raise $100 million. EGI will purchase 30.3 million shares at $3.30, which is a 7% premium to MiddleBrook's close of $3.07 on Tuesday, before the deal was announced. EGI also will receive a five-year warrant to purchase 12.1 million shares at $3.90. Pre-financing, MiddleBrook (formerly Advancis) has 56 million shares outstanding.

As part of the agreement, John Thievon will replace Edward Rudnic as president and CEO, and David Becker will become EVP of finance and CFO, replacing VP of Finance and CFO Robert Low. Thievon and Rudnic were most recently at Adams Respiratory Therapeutics, which was acquired earlier this year by Reckitt Benckiser (LSE:RB). At Adams, Thievon was EVP of sales and corporate accounts, and Becker was CFO. Thievon and EGI's William Pate and Mark Sotir will join MiddleBrook's board. The deal, which is subject to shareholder approval, is expected to close in 60-90 days. ...