Rapid diagnostics specialist genedrive PLC (LON:GDR) has raised £5.6mln, net of expenses, through a successful placing of shares and the issue of convertible loan notes.
The company said it raised gross proceeds of £3.5mln via a conditional placing of 15,217,391 shares at 23p each – last night’s closing mid-market price – with new and existing investors. In afternoon trading, genedrive shares held steady at the 23p level.
genedrive raised a further £2.5mln through the issue of convertible loan notes to small and medium-cap backer, BGF.
The loan notes, which carry a coupon of 7%, mature on June 30, 2025 and will be convertible into genedrive shares at 28.75p a pop.
The company has also announced a proposal to raise up to a further £500,000 by way of a broker option to allow existing and other investors to participate in the fund-raising at the 23p-a-share placing price, which will be open until 6 December 2018.
The net proceeds will fund the working capital needs of the company in relation to the launch of the Genedrive HCV-ID Kit for Hepatitis C diagnosis and support projects to enhance the gross margin for this assay.
The money will also fund the company's assay development programmes in antibiotic-induced hearing loss (AIHL) and tuberculosis (mTB) and the continued development of the Genedrive system.
"The HCV market is significant with many millions of people affected by the disease in low and middle-income countries but low diagnosis rates. We have the first-to-market point-of-need molecular test, a strong commercial platform and a clear strategy to deliver revenue growth. A test for antibiotic-induced hearing loss, a first product aimed at non-LMIC markets, and the re-launch mTB provide further potential to benefit from the capabilities of our Genedrive diagnostics platform,” said David Budd, the chief executive officer of genedrive.
"Securing BGF as a cornerstone investor and the fundraising we have announced today will put us in a strong position to deliver on these opportunities," he added.
GeneDrive #GDR— Dearg Doom (@MyDeargDoom) November 16, 2018
Share Price 23p (pre-open)
Raising funds at market price indicates some value here even if it's not the last. Domestic market seems small so wider country adoption necessary.
Proposed placing to raise £3.5m
Issue of £2.5m Loan Notes
Broker option for extra £0.5m pic.twitter.com/5k772OXB17
In a separate announcement, the company revealed it had £3.5mln in cash at the end of June, down from £5.1mln the year before, after posting a loss before tax of £7.8mln in the year to the end of June, versus a loss the year before of £7.6mln.
Revenue declined to £1.94mln from £2.61mln.
“Progress during the year has been positive,” Budd said, with the company accomplishing many of the objectives it had set itself at the start of the financial year.
- Adds placing completion details, share price --