Proceeds to further expand service offering, capacity and capabilities to meet customer demand
Cambridge, UK, 5 April 2017 – Abzena plc (AIM: ABZA, “Abzena” or the “Group”), the life sciences group providing services and technologies to enable the development and manufacture of biopharmaceutical products, announces its intention to undertake a placing to raise approximately £25 million (the “Placing”) to expand further its service offering, capacity and capabilities.
John Burt, Chief Executive Officer of Abzena, said:
“Our existing and prospective customers are developing novel but complex biological therapies for a wide range of diseases, from rare genetic childhood disorders to cancer. Our experience and reputation as a biopharma service and technology provider continues to grow and as a result our customers’ demand is currently outstripping our capacity.” “This new funding will enable us to build on the Group’s foundations, maximising the opportunities being presented to us and accelerating progress to sustainable profitability.”
Introduction
The Placing is being conducted through an accelerated bookbuild process (the “Bookbuild”) which will be launched immediately following this announcement and will be subject to the terms and conditions set out in the Appendix (this announcement, together with the Appendix, the “Announcement”).
The Placing is conditional upon the passing of certain resolutions. A circular is expected to be posted later today (the “Circular”) notifying shareholders of a general meeting for the purpose of considering the relevant resolutions at The Cambridge Building, Babraham Research Campus, Babraham, Cambridge CB22 3AT expected to be convened at 10.00 a.m. on 21 April 2017.
Numis Securities Limited (“Numis”) and N+1 Singer Advisory LLP (“N+1 Singer”) have been appointed as joint bookrunners (together the “Joint Bookrunners”) in respect of the Placing. Numis is acting as nominated adviser to the Group.
Reasons for the Placing
Abzena is a growing international services and technology group enabling the development of better biopharmaceuticals. Abzena’s services are currently provided to a global customer base, including 18 of the top 25 major biopharmaceutical companies over the past three years.
Since its IPO in July 2014, Abzena has significantly expanded both its service offering and geographic footprint through two acquisitions in the US, substantially increasing its client base and breadth of service offering in the process. The Group has continued to secure further licence agreements for Abzena Inside technologies which have been incorporated into products being developed by its customers. Currently, a total of 12 Abzena Inside products are in clinical development (compared to five at the time of IPO) and the Group anticipates a further two to three such products entering clinical trials each year.
The Directors believe there is growing structural demand in the market for the Group’s services and that it has a significant competitive advantage through being able to offer a wide and expanding range of biology, chemistry and biomanufacturing services. This allows the Group to provide its customers with a range of complementary services enabling the translation of drug discovery research projects through to Phase II clinical development. The Group is now looking to expand further its service offering, capacity and capabilities.
Use of proceeds
Abzena will use the net proceeds of the Placing to drive additional growth in the business, which the Board believes can create critical mass and enable the Group to capitalise on significant cross selling opportunities across its complementary service and technology offerings through:
• Upgrading and growing its US based biomanufacturing facilities and capabilities;
• Investment in its existing biology, chemistry and biomanufacturing services in the UK and US; and
• Investment in the Group’s sales and business development functions.
The Board believes the proposed expenditure will drive revenue growth, margin improvement and operational gearing which will accelerate the Company’s progression to profitability and significantly increase shareholder value. This Announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 (“MAR”). In addition, market soundings (as defined in MAR) were taken in respect of the Placing with the result that certain persons became aware of inside information (as defined in MAR), as permitted by MAR. This inside information is set out in this Announcement. Therefore, those persons that received inside information in a market sounding are no longer in possession of such inside information relating to the Company and its securities.
