(Sharecast News) - Motif Bio, which has been reclassified as an AIM rule 15 cash shell, has raised a total of ?0.65m before expenses via a placing, it announced on Tuesday, through the issue of 162,500,000 ordinary shares with an institutional investor at a price of 0.4p each.
The AIM-traded firm said it was undertaking the placing in response to investor demand, explaining that it would strengthen its balance sheet as its directors focussed on sourcing an appropriate reverse takeover candidate.
Its board was currently in discussions with several companies in the healthcare sector that were interested in a reverse takeover, although it said that no assurances could be provided that the effort will be successful.
"Following its reclassification as an AIM rule 15 cash shell in January, the company is required to make an acquisition which constitutes a reverse takeover under the AIM rules by 28 July, failing which the company's ordinary shares would be suspended from trading on AIM pursuant to AIM rule 40," the board explained in its statement.
"The company's admission to trading on AIM would then be cancelled six months from the date of suspension, should the reason for the suspension not have been rectified."
Motif Bio said the net proceeds of the placing would be used to strengthen its balance sheet, and to provide it with additional working capital.
Following the placing, Motif Bio would have cash of around ?0.82m, which would provide it with sufficient working capital until February 2021.
The directors said they would continue to impose disciplined cost controls.
At 0914 BST, shares in Motif Bio were down 35.57% at 0.96p.
2 Mar 2016 09:24