This story has been updated with quotes from Scott Sweet.
NEW YORK (
(FIVE - Get Report)
shares retreated Friday after announcing late Thursday that it was postponing its secondary offering common stock.
The discount accessories, toy and craft retailer, known for selling products at $5 and below, said that it was postponing the offering, launched on Wednesday, as a result of the "current capital market conditions," according to a press release.
The company didn't provide further information in the release as to when the offering would be rescheduled. An outside spokesman was not immediately available.
Five Below shares initially rose as much as 4.3% on Friday, but had give back the majority of those gains. Shares were recently trading at $37.48, up 0.19%.
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The U.S. stock market plunged Thursday -- the most in 19 months -- on fears the
is working on plans to reduce its bond-buying stimulus program. Fed Chairman Ben Bernanke's comments also lent credence to the notion that interest rates may be adjusted upward, and that mortgage rates, currently at historic lows, could follow as well, according to
Not surprisingly, shares of Five Below nosedived more than 5% on Thursday.
The Philadelphia-based company on Wednesday launched its secondary offering of about 8.6 million common shares. The shares were being sold by current shareholders, who included some of the company's executive management and board of directors, it said. The company was not expected to receive any proceeds from the sale.
Scott Sweet, senior managing partner at IPO Boutique, says the deal was likely postponed due to lack of orders following the market plunge. He expects the company will look to complete the deal when the markets are more stable.
"This in no way reflects upon how the company is doing right now but .. insiders [were] hoping that they could have gotten more on the secondary. Five Below was hit pretty hard yesterday as was most everything," Sweet said. "I often see on deals that IPOs and secondary [offerings] postponed due to market conditions. In this case it was probably legit."
are acting as joint book-running managers of the offering.
-- Written by Laurie Kulikowski in New York.
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