ErgoMed of 2,029,971 new Ordinary Shares at 190p per share to raise gross proceeds of approximately £3.9 million.
London, UK – 1 February 2018: ErgoMed, Inc., a specialised pharmaceutical services and drug development company, announces a placing (the “Placing”) of 2,029,971 new Ordinary Shares (“Placing Shares”) at 190p per share to raise gross proceeds of approximately £3.9 million (the “Placing Price”).
The Company has raised approximately £3.9 million by way of a placing with existing and new investors. The proceeds of the Placing will be used to fund:
- Initial cash considerations for small bolt-on acquisitions to support the Company’s Drug Safety & Medical Information and orphan drug CRO service offering;
- Capital expenditure on IT platforms to support the Company’s Drug Safety & Medical Information business; and
- Provide the Company with additional working capital.
As at 31 December 2017, the Company had a cash balance of £3.2 million and no debt.
Background to the use of proceeds
An integral component of the Company’s strategy is the addition of selected acquisitions to accelerate the growth of the Company’s services offering. The Company has identified certain technology and consulting businesses to enhance its Drug Safety & Medical Information business, which includes PrimeVigilance. The Company has also identified a number of small profitable services businesses which could be integrated into its existing operations, all of which are expected to enhance earnings. There can be no assurance that all, or any, of these potential acquisitions will be consummated.
A state-of-the-art technology platform is critical for executing PrimeVigilance’s growth strategy. It has already piloted robotic process automation and is now looking at expanding the use of robotics software in suitable process workflows. In addition, PrimeVigilance may wish to acquire additional adverse event databases, as requested by prospective clients.
Commenting on the Placing, Stephen Stamp, Chief Executive Officer of Ergomed plc said: “This Placing provides us the flexibility to move forward on a number of fronts, in particular securing and enhancing the technology platform to advance our leading market position and drive further growth in our Drug Safety & Medical Information business.”
Details of the Placing
The Placing was undertaken by Numis Securities Limited (“Numis) acting as the Company’s Broker and Nominated Adviser.
Under the terms of the Placing, Ergomed will admit to trading 2,029,971 new ordinary shares of 1 pence each in the capital of the Company, representing approximately 5 per cent of the existing issued ordinary share capital of the Company.
The Placing Shares will, when issued, be credited as fully paid and will rank pari passu with the existing ordinary shares of 1 pence each in the capital of the Company including the right to receive all future dividends and distributions declared, made or paid by reference to a record date falling after their issue.
The Company has applied for the Placing Shares to be admitted to trading on AIM (“Admission”). It is expected that settlement of subscriptions in respect of the Placing Shares and Admission will take place and that trading in the Placing Shares will commence at 8.00 a.m. on 6 February 2018. Following Admission, the total number of Ordinary Shares in the Company will be 44,710,784. The Company holds no treasury shares and therefore the total number of voting rights is 44,710,784.
The Placing is conditional upon, inter alia, Admission becoming effective. Further details of the Placing Agreement can be found in the terms and conditions of the Placing contained in the Appendix to this Announcement (which forms part of the Announcement).
Your attention is drawn to the detailed terms and conditions of the Placing set out in the Appendix to this Announcement.
Current trading and outlook
In its trading update on 25 January 2018, the Company announced that for the year ended 31 December 2017, service revenue increased 35%, new service business won totalled £54 million and there is a contracted order book backlog of £88 million.
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.
