Shares of Thomas Properties Group jumped more than 20 percent Wednesday morning after the company said that it will make a private placement of about 8.7 million shares of common stock to institutional investors, priced at a significant premium that will gain the investors a seat on the board.

The Los Angeles commercial real estate company said that the investors are affiliated with Madison International Realty of New York. The purchase price of $5.75 a share – a 42 percent premium to the stock’s closing price on Tuesday – will result in gross proceeds of about $50 million. Net proceeds will be used for general corporate purposes, including potential acquisitions.

Madison is a real estate private equity firm focused on providing secondary equity capital. Under the agreement, the investors will have the right to appoint one director at the next regular meeting of Thomas Properties board of directors.

Thomas Properties now has 37.3 million shares outstanding, so the placement would increase the number of shares by about 23 percent. The private placement is expected to close by June 12.

Shares were up 91 cents, or 23 percent, to $4.96 in midday trading on the Nasdaq.