NEW YORK (TheStreet) -- Shares of Cott Corp (COT) are slumping, down 2.5% to $9.35 on heavy trading Wednesday afternoon following the announcement that underwriters co-led by CIBC and Barclays have agreed to purchase 14.1 million common shares at a price of $9.25 a piece.
The gross proceeds to Cott is about $130.42 million. The company intends to use its net proceeds from the offering to redeem its Series B non-convertible preferred shares and a portion of its Series A convertible preferred shares.
Additionally, Cott granted the underwriters an option to purchase up to an additional 2.11 million common shares on the same terms and conditions, up to 30 days after the closing of this offering.
The offering is expected to close on or around June 3.
As of 2:40 p.m. ET today, about 3.06 million shares of Cott have exchanged hands as compared to its average daily volume of about 528,641 shares.
Canada-based Cott is the producer of beverages on behalf of retailers, brand owners and distributors.
The company's product lines include carbonated soft drinks, juice and juice-based products, clear, still and sparkling flavored waters, energy drinks, sports products, new age beverages and ready-to-drink teas, as well as alcoholic beverages for brand owners.
Separately, TheStreet Ratings team rates COTT CORP QUE as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate COTT CORP QUE (COT) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and feeble growth in the company's earnings per share."