Futura Medical PLC (LON:FUM) shares jumped higher on Monday after the med-tech group raised £3.25mln with backing from private and professional investors.
The Swiss bank Lombard Odier chipped in just over £2mln acquiring shares at 8p, while users of the Primary Bid platform contributed the remainder in an oversubscribed share offer.
Lombard, which will receive 9.4mln warrants vesting at 40p, will see its stake in Futura rise to 19.31% following the additional investment.
The cash injection will be used to bolster the company’s working capital requirements as it seeks regulatory approval as a medical device for DermaSys, which is used to deliver drugs through the skin.
Futura has used the brief post-election opening of the equities markets to top up its coffers after what are seen as nuanced results from the company’s phase III clinical trial.
The data, released earlier this month, showed that on its own, DermaSys was as effective as the drug payload it was designed to carry in treating erectile dysfunction. In other words, it was efficacious, safe and worked as rapidly as active ingredient glyceryl trinitrate, or GTN for short.
Now Futura reckons the result provided it with a "simpler route to regulatory approval”. However, the rapid share price fall in the wake of the read-out suggested more than a little scepticism in the wider market.
That said, potentially raising more than £3mln in the dying days of the year, traditionally a no-go for City fundraisers, suggests Futura has more backing than the current share price would suggest.
And the warrant attached to the Lombard shares - exercisable from 40p - suggests both Futura and the Swiss bank see plenty of upside from current levels.
The market seemed to agree, with Futura shares up 15.3% to 10.38p in morning trade on Monday.
In a note to clients, analysts at Liberum Capital placed their 'buy' rating and 60p price target for Futura 'under review', while pointing out that: "As a result of the fundraising the company now believes it has sufficient cash to fund the business for at least 12 months."
-- Adds share price, analysts comment --