Avacta reels in £5.75m bonus through demand for shares
Demand from individuals and institutional investors for shares in Cambridge life sciences business Avacta is helping the company raise £5.75 million through subscriptions and a placing.
Quoted on the UK’s AIM exchange, Avacta is developing Affimer® biotherapeutics and research reagents for nextgen cancer therapies.
A proposed subscription to raise gross proceeds of £2 million is in train. The two subscribers are Clare Hughes (wife of Richard Hughes, co founder of Zeus Capital) and Mahmud Kamani, co-founder of Boohoo.com.
Additionally, in response to what it calls “substantial institutional interest,” the company has conditionally raised further gross proceeds of £3.75 million through a placing.
Admission of both the placing and subscription shares is subject to, amongst other things, shareholder approval at a general meeting, notice of which was being sent to shareholders later today.
finnCap is acting as nominated adviser and joint broker with regards the placing. Neither issue is to be underwritten.
The company intends to utilise the net proceeds of the subscription to continue to execute the strategy it outlined last October. The key objectives are to enter the clinic with its first preCISION chemotherapy programme, to secure further significant drug development partnerships that help progress the company's technology platforms and to continue to grow revenues and secure licensing partnerships for Affimer® diagnostics reagents.
Given the current economic climate the board has deemed it prudent to take on a small amount of additional equity capital to ensure the business is in a strong position to exploit progress after the coronavirus pandemic is over.
Avacta also posted an upbeat trading update. Following the collaboration and option agreement with Swiss company ADC Therapeutics SA at the end of 2019, Avacta has successfully expanded the LG Chem Life Sciences Partnership and established a joint venture in South Korea with Daewoong Pharmaceutical Co. Ltd.
The company expects to announce its results for the 17 months to December 31 later this quarter and ended the period with cash balances of £8.7 million.