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In a recent 8-K filing with the Securities and Exchange Commission, Sotera Health Co (NASDAQ:SHC) disclosed a board member's resignation and a significant stock transaction. David A. Donnini, a director designated by GTCR, resigned from his position on Friday, following the sale of shares that led to a reduction in GTCR's designated directors from three to two.
The board will now consist of 11 directors instead of 12. Mr. Donnini's departure is not due to any disagreements with the company's operations or management.
Additionally, on September 4, 2024, Sotera Health entered into an underwriting agreement with Citigroup Global Markets Inc. and certain selling stockholders. Under this agreement, 25 million shares of Sotera Health's common stock were sold by the selling stockholders at $15.03 per share on Friday. Sotera Health did not sell any shares nor will it receive proceeds from this transaction.
The details of this underwriting agreement are included in the filing as Exhibit 1.1, and the validity of the shares has been confirmed by legal opinion from Cleary Gottlieb Steen & Hamilton LLP, which is filed as Exhibit 5.1.
In other recent news, Sotera Health has reported an uptick in revenue and adjusted EBITDA in the second quarter of 2024, indicating steady growth across all business segments. The company's major segment, Sterigenics, experienced a revenue increase due to pricing benefits and favorable volume. Nordion's revenue saw a significant 29% rise due to reactor harvest schedules, while Nelson Labs continued its growth trajectory.
Sotera Health also launched a secondary offering of 25 million shares of common stock, exclusively offered by affiliates of Warburg Pincus LLC and GTCR LLC. This move is expected to result in these firms relinquishing their majority ownership in Sotera Health. Citigroup is serving as the underwriter for the offering.
Looking forward, Sotera Health anticipates upper single-digit revenue growth in the third quarter, with steady revenue expected from Nelson Labs in the second half of the year. The company's full-year margin rates are projected to approach 30%, and capital expenditures are likely to be at the lower end of the $205 million to $225 million range.
Despite potential foreign exchange headwinds and a slight delay in Sterigenics' capacity expansion, Sotera Health has reaffirmed its full-year 2024 outlook, projecting a 4% to 6% growth in revenue and adjusted EBITDA compared to 2023.
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