The company expects to raise at least $12 million with its international entitlement offer, taking into account underwriting fees and repayment of a $5 million loan
The medical technologies company’s core business is to help healthcare professionals create life-changing outcomes for patients.
Admedus is offering five fully paid new shares for even seven held by its investors.
The new shares are priced at 8 cents each, a 40.74% discount to the 13.5-cent last-traded price of shares on August 1, 2018.
The price is a 38.6% discount to the volume-weighted average issue price paid by its major shareholder Star Bright Holding Ltd under an 11.2-cent placement completed on September 5, 2018.
Each new share will come with a free-attaching option with an 8-cent exercise price that expires three years from the issue date.
Admedus chief executive officer Wayne Paterson highlighted the offer’s importance to the company’s recapitalisation efforts.
He said: “The entitlement offer marks an important step in Admedus’ recapitalisation plan that it has been working towards since August 2018.
“Capital raised from this rights issue will provide funding for Admedus to consolidate and further develop the ADAPT portfolio and position itself for the development of new products in 2019.”
ADAPT was invented by Admedus’ cardiovascular science vice-president Professor Leon Neethling and is a pioneering technology to enable the manufacture of biomaterial scaffolds that mimic human tissue.
It has been used to create scaffolds, such as the next generation collagen scaffold VascuCel, used in cardiac repairs and reconstruction procedures for many years.
Major shareholder Star Bright, which has a 19.99% stake in Admedus, has acknowledged the potential of the ADAPT technology to deliver tangible benefits for the global medical community and its patients.
ADAPT sales grew by 63% to $3.1 million in the September 2018 financial quarter when compared to the previous corresponding period, driven by US, EU and emerging market growth, and favourable exchange rate movements.
The entitlement offer is partially underwritten by several investors for $9.1 million before underwriter fees.
Admedus’ chief highlighted the confidence shown by the parties who had chosen to underwrite the company’s offer.
Paterson said, “Investors should gain confidence from the funding that has been committed to the entitlement offer through underwriting from majority shareholder Star Bright Holding Limited and SIO Partners, LLC, a US-based healthcare-dedicated institutional investment fund.”
Star Bright is a private investment company owned by Zhang Lishan, whose business interests are primarily global asset and equity investments.
Admedus shareholders registered to Australian, New Zealand, Hong Kong, Singaporean and Philippines addresses have until 7pm market time on Monday next week, December 3, to subscribe for new shares.
Shareholders may sell all of their entitlements, part of them or transfer them to another person.