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Amphion Innovations unveils new loan financing

Amphion Innovations unveils new loan financing

Amphion Innovations (LON:AMP) has secured a new loan facility to support its IP licensing programme and further develop its partner companies. 

Amphion is growing value by commercialising the intellectual property (IP) from seven partner firms, which are medical and technology focused. 

The financing is in the form of a new US$2mln share-backed loan from an institutional lender and there is potential to increase that to US$10mln, it said. 

Chief executive Richard Morgan told investors: "Amphion has expectations of cash inflows from several different sources over the next six to 12 months and this facility provides the capital we need to bridge to those inflows without incurring excessive dilution. 

"These funds will enable us to continue to support our IP licensing programme and the further development of our partner companies.” 

The loan is secured against Amphion’s holdings in Kromek and may be repaid at the company’s discretion in cash, the issue of Amphion shares, or the payment of Kromek shares where the lender will be subject to certain limitations. 

Amphion must repay the debt monthly starting on 1 September this year with the final payment due on June 1, 2015. 

The interest rate is 12% a year. As part of the deal, the lender will receive around 8.53 mln three-year warrants in Amphion with an exercise price of 4.375 pence per share. The current share price is 2.625p. 

In addition, Amphion will be issuing 663,627 simulated Kromek warrants at an exercise price of 56.25p. 

Richard Morgan added: “As a large shareholder of Kromek, Amphion remains committed to supporting the company and excited about its prospects.  Kromek has a strong technology platform that has the potential to make a major impact on medical imaging and other sectors.  We believe the very bright future of the company should be reflected in a much higher valuation in due course.  

"Amphion currently has some exciting developments underway, but in order to support our partner companies and progress our IP licensing programme we need access to additional capital.  This new financing will help Amphion to bring those developments to fruition.  I look forward to being able to report progress in the coming months and we believe that should allow us to retain our entire holding in Kromek." 

In April, the company announced it had received a favourable ruling in the US appeals court in cases involving computer giants SAP and Microsoft, which paves the way for its DataTern business to advance.

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