Group News
Avacta Group plc Placing
Oct 21, 2009Target of becoming a substantial and profitable business supporting the life sciences sector is on track.
Avacta
Group plc (“Avacta” or “the Company”), the biophysics company which provides
innovative high value technologies and services to the pharmaceutical and
diagnostics markets, announces that it proposes to raise up to £2 million
(gross of expenses) from a conditional placing of 133,333,328 new ordinary
shares of 0.1 pence each ("New Ordinary Shares") at a price of 1.5
pence per Ordinary Share (the "Placing"). 96,666,662 of the New
Ordinary Shares have been placed by Daniel Stewart & Co plc ("Daniel
Stewart") with institutional and other existing and new shareholders
pursuant to a Placing agreement, the details of which are set out below. The
remaining 36,666,666 New Ordinary Shares are to be placed by Daniel Stewart
using a reasonable endeavours basis within 6 weeks of this announcement and
this will be the subject of a separate announcement.
Use of Proceeds
& Strategy
The cash proceeds of
the Placing, amounting to approximately £2 million (before expenses) will be
used to accelerate Avacta from the strong position it has achieved since
admission to AIM, towards its near term goal of being a profitable and
substantial business providing products and services to support the life
sciences sector. The funds will be deployed to support the rapid growth of
Avacta’s own products and services and to support further acquisition
opportunities.
Since coming to AIM in
late 2006 Avacta has exceeded its stated developmental and commercial
milestones and has established two operating businesses in its target markets
of drug development and diagnostics. These businesses form the routes to market
for its high value technology products. The Company recently announced the
first sales of Optim, its flagship product, which is designed to significantly
reduce risk and cost throughout the biopharmaceutical drug development process.
In addition, the Company is expected to launch its first diagnostic product,
Midas, into the veterinary healthcare market in early 2010. This system will be
capable of delivering a wide menu of rapid diagnostic blood tests for both
veterinary and, in due course, human healthcare. Avacta has several other
products in development which will follow Optim into the drug development
market and has already received sufficient customer interest indicating
considerable demand.
The funds raised will
be used to accelerate the commercialisation of these new products and
diagnostic tests through improvements in infrastructure and enhanced commercial
teams. In addition to its organic product pipeline, the Company is pleased to
report its achievements in integrating the four complementary acquisitions made
during the past two years. The Company has identified and is exploring
other potential acquisition targets each of which could bring technologies
and expertise into the growing business.
The Placing
The Placing Agreement contains warranties in favour of Daniel Stewart given
by the Company and the Directors with respect to its business and certain
matters connected with the Placing. In addition, the Company has given
customary indemnities to Daniel Stewart in connection with the Placing and
their performance of services in relation to the Placing. Daniel Stewart has
certain rights to terminate the Placing Agreement in specified circumstances.
See RNS announcement for full details.