Neuren Pharmaceuticals Limited (ASX: NEU) advises that it will undertake a non-renounceable rights issue to raise up to A$10.1 million. The rights issue will be offered to shareholders on the basis of one new share for every two shares held on the record date of 2 January 2008, at a subscription price of A$0.14 per share for Australian resident shareholders and the New Zealand dollar equivalent of NZ$0.16 per share for New Zealand resident shareholders.
The Company has entered into an underwriting agreement with respect to the rights issue whereby Taylor Collison Limited has agreed to underwrite the issue of 50.7 million shares, ensuring that the issue will raise a minimum of $7.1 million before costs.
The underwritten amount of A$7.1 million will support Glypromate® clinical trial costs and overhead through 2008. The full A$10.1 million will support completion of the Glypromate® Phase 3 trial as well as associated overhead and corporate operating expenses. The Glypromate® Phase 3 trial is proceeding to plan.
Neuren has a number of licensing and joint venture initiatives underway both locally and internationally to assist in the funding required to ensure that the Company’s pipeline of other lead compounds moves through to the next stage of clinical trials during CY08. The Directors have decided that until such funding is available, the primary focus of the Company will be the completion of the current Phase 3 Glypromate® trial.
A shortfall facility has also been included in the Offer for those who wish to subscribe for more than their entitlement.
Option holders will not be entitled to participate in the offer unless they exercise and are registered by the record date of 2 January 2008.
Full details of the rights issue are contained in a Letter of Offer (for Australian resident shareholders) and an Investment Statement and Prospectus (for New Zealand resident shareholders) that will be lodged with ASX Limited later today.