Drug discovery and development company e-Therapeutics has proposed raising $62 million through an issue of new ordinary shares to existing and new institutional investors.
The new shares will be priced at 32p, a premium of 4% to the closing mid-market price on the last dealing day before this announcement. Irrevocable undertakings of support have been received from shareholders representing approximately 86% of the company's equity in advance of a general meeting where approval for the issue will be sought.
Following the proposed issue, e-Therapeutics will have pro-forma net cash and liquid resources of approximately $75 million. Together with expected receipts from R&D tax credits and interest, these resources are intended to support all of the company's currently planned discovery and development activities into 2017, by which time the directors believe an out-licensing deal could be concluded for the e-Therapeutic's lead cancer drug, ETS2101.
The principal planned uses of the enlarged cash resources are:
"We appreciate the continuing support of existing investors and are also pleased to have attracted significant new investors to the company,” said Malcolm Young, CEO of e-Therapeutics. “With our financial position secure we are well placed to build further shareholder value based on our innovative platform and product portfolio."
The funds to be raised through the new issue will include a substantial further investment by Invesco Asset Management, whose shareholding will increase from 45.92% to 49.90% after completion. The Takeover Panel has granted an Accelerated Rule 9 Waiver in respect of the acquisition of new shares by Invesco.