16 Nov 2007 07:00
For immediate release 16 November 2007
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES, JAPAN, CANADA, AUSTRALIA OR THE REPUBLIC OF IRELAND LiDCO Group Plc ("LiDCO" or the "Company") Placing of 23,647,074 new Ordinary Shares at 8.5 pence to raise approximately ‚£2.0 million
LiDCO, the cardiovascular monitoring company, today announces that it has conditionally completed a placing of 23,647,074 new ordinary shares of 0.5p each ("Ordinary Shares") at a price of 8.5 pence per Ordinary Share with institutional investors and high net worth individuals. Terry O'Brien, LiDCO's CEO, is also subscribing 705,884 shares at the placing price of 8.5p per Ordinary Share. The Company announces that, following the closing of the Placing, the Company will have raised approximately ‚£2.0 million before expenses.
Reasons for the Placing:
The monies raised will be used for:
* marketing the Company's growing product range and further developing its sales and distribution network; * accessing more fully the substantial and growing high-risk surgical market opportunity through the introduction of the forthcoming LiDCOrapid product as well as continuing to support the Company's existing critical care market sales revenue growth; and * continuing the Company's active Research and Development programme, including the finalisation of development associated with bringing the new anaesthesia product LiDCOrapid to market.
Commenting on the successfully Placing, Dr. Terry O'Brien, LiDCO's CEO said:
"I am pleased to announce the successful raising of ‚£2 million from our existing shareholders based both in the UK and USA. The Placing was oversubscribed with the participating shareholders representing approximately half of our existing shareholder base. I am especially pleased that investors on both sides of the Atlantic have joined in this Placing which will help us to further promote our new and existing products to the growing minimally invasive hemodynamic monitoring market."
The Placing is conditional on, inter alia, the approval by the Shareholders of a resolution at a general meeting to be held on 11 December 2007 (the "General Meeting"). A Circular together with notice of General Meeting will today be dispatched to Shareholders. Subject to, inter alia, the passing of the resolution at the General Meeting the Company, through Panmure Gordon & Co, will apply for the Placing Shares, which will rank pari passu with existing Ordinary Shares, to be admitted to trading on AIM, and expects that admission will occur on 12 December 2007.
Copies of the Circular being posted to Shareholders will be available to the public, free of charge, from the date of this announcement for the period of one month at the offices of Panmure Gordon & Co at:
Panmure Gordon & CoMoorgate Hall155 MoorgateLondonEC2M 6XB
For further information please contact:
LiDCO Group Plc Tel: +44 (0)20 7749 1500 Terry O'Brien - Chief Executive Theresa Wallis - Non-Executive Chairman Buchanan Communications Tel: +44 (0)20 7466 5000 Tim Anderson, James Strong
Nominated Adviser and Broker: Panmure Gordon & Co Tel: +44 (0)20 7459 3600
Edward Farmer, Katherine Roe Mark Lander (Corporate Broking)
Background to and reasons for the Placing
Recent Commercial Performance
The Directors estimate that the market for minimally invasive hemodynamic monitoring products is growing at an encouraging rate judged to be at around 50 per cent per annum. Our own revenues have grown by 22 per cent over the first half of this year compared with the prior period. Sales revenue increased without additional spend in administration or direct product costs. Administrative and distribution expenses decreased by ‚£138,000 (5 per cent) and as a result the reported net loss before tax was down 29 per cent (‚£433,000 lower) compared to the prior period.
Sales and Marketing Activity
Despite the good progress that has been achieved in the first half of the financial year in significantly reducing the monthly operating cash outflow (which is down 31 per cent from ‚£235,000 to ‚£162,000 per month), in order to achieve greater access to the growing world-wide market for hemodynamic monitoring, the Company will require additional funds for marketing its growing product range and to further develop its sales and distribution network.
The introduction of a quicker and simpler to set-up and use surgery product (the LiDCOrapid) is anticipated to allow us, and our existing distribution partners, to access more fully a substantial and growing high-risk surgical market opportunity. Furthermore, the simpler regulatory requirements and user set-up and therefore less specialized sales support required for selling this product, opens up the possibility for LiDCO to appoint additional distributors in countries and territories where our LiDCOplus product is not yet represented. The Company will use some of the proceeds of this Placing to continue to support its existing critical care market sales revenue growth. Additionally, during late 2007 and continuing into 2008 LiDCO will endeavour to secure additional distribution partners, launch and then promote the forthcoming LiDCOrapid product. Company estimates of the market size for sales of disposables into the global high-risk surgery market suggest that this market could eventually reach annual sales revenues of over ‚£400 million per annum.
Research and Development
In order to support our sales growth, part of the proceeds of this Placing will be used to continue our active Research and Development programme as described in the announcement of the interim results for the 6 months to 31 July 2007. Commercially, the most important of these activities is to finalise the development associated with bringing our new anaesthesia product known as LiDCOrapid to the market during 2008. There will be a requirement for additional cash to support the working capital required to purchase sale stock of both the LiDCOrapid monitor and the associated disposable products.
Working Capital
The Directors are of the opinion that, taking into account the proceeds of the Placing, the Company will have sufficient working capital for its present requirements, that is to say, for at least the next 12 months.
The Company retains its secured revolving convertible loan facility of $2,000,000 with Laurus Master Fund Ltd and the current sum outstanding is approximately ‚£533,000. This facility will terminate in August 2008 and the Company expects to be able to replace this facility at that time.
APPENDIX
TERMS AND CONDITIONS OF AND IMPORTANT INFORMATION ON THE PLACING
The UK Placing and the terms and conditions herein, are directed exclusively at persons falling within Article 19 and/or Articles 47 to 50 of the Financial Service and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (such category of investors being referred to as "Relevant Persons") and no other person should respond to this announcement. Accordingly, this announcement is exempt from the general restriction set out in Section 21 of the FSMA on the communication of invitations or inducements to engage in investment activity and has not been approved by a person who is authorised under the FSMA.
Members of the public are not entitled to take part in the UK Placing and this announcement is communicated to them for the purposes of information only. This announcement and the terms and conditions herein must not be relied on, acted on or responded to by persons who are not Relevant Persons. If you are in any doubt as to whether you are a Relevant Person you should consult a professional adviser for advice.
This announcement and appendix do not constitute an offer to sell or issue or solicitation of an offer to buy or subscribe for new Ordinary Shares in any jurisdiction, and any acquisition or application for Ordinary Shares should only be made on the basis of information contained in this document.
The following definitions have been used in this announcement:
"Admission" admission of the Placing Shares to trading on AIM becoming effective in accordance with the AIM Rules "AIM" the AIM market of the London Stock Exchange "AIM Rules" the rules for AIM companies and their nominated advisers as published by the London Stock Exchange from time to time "Board" or "Directors" the directors of LiDCO "Circular" the Circular dated 16 November 2007 describing the Placing and giving notice of the General Meeting "CREST" the relevant system (as defined in the Uncertificated Securities Regulations 2001) in respect of which Euroclear UK & Ireland is the Operator (as defined in the Uncertificated Securities Regulations2001) "Euroclear UK & Euroclear UK & Ireland Limited Ireland" "Existing Ordinary the 118,335,980 Ordinary Shares in issue as at the Shares" date of this announcement "FSMA" Financial Services and Markets Act 2000 (as amended) "Group" LiDCO, its subsidiaries and its subsidiary undertakings "London Stock London Stock Exchange plc Exchange" "Ordinary Shares" ordinary shares of 0.5p each in the capital of the Company
"Panmure Gordon & Co" Panmure Gordon (UK) Limited (trading as Panmure
Gordon & Co) whose registered office is at Moorgate Hall, 155 Moorgate, London, EC2M 6XB, the Nominated Adviser and Broker to the Company "Placing" the placing of 11,174,134 Ordinary Shares pursuant to the terms of the UK Placing Agreement and the subscription of 12,472,940 Ordinary Shares pursuant to the US Subscription Agreements "Placing Agreement" the conditional agreement dated 16 November 2007 between the Company and Panmure Gordon & Co relating to the Placing "Placing Price" 8.5p per Ordinary Share "Placing Shares" 23,647,074 Ordinary Shares which are the subject of the Placing "Prospectus Rules" the Prospectus Rules made by the Financial Services Authority with effect from 1 July 2005 pursuant to Commission Regulation (EC) No. 809/2004 "UK Placing" the conditional placing by Panmure Gordon & Co, on behalf of the Company, of the UK Placing Shares at the Placing Price, pursuant to the terms and conditions of the Placing Agreement "UK Placing Shares" 11,174,134 Ordinary Shares which are the subject of the UK Placing Agreement "US Subscription the subscription agreements dated on or about 15 Agreements " November 2007 between the Company and certain of its US shareholders for the conditional subscription of 12,472,940 Ordinary Shares, in aggregate, in the Company "US Subscription the 12,472,940 Ordinary Shares to be issued pursuant Shares" to the US Subscription Agreements "Securities Act" the US Securities Act of 1933, as amended "Shareholders" holders of Existing Ordinary Shares The Placing
Pursuant to the UK Placing Agreement, Panmure Gordon & Co on behalf of the Company, has conditionally placed 11,174,134 new Ordinary Shares at the Placing Price. The Company, has entered into the US Subscription Agreements pursuant to which certain US investors have conditionally subscribed for 12,472,940 Ordinary Shares. The Placing will raise approximately ‚£2.0 million (approximately ‚£1.9 million net of expenses).
Application will be made (conditional on the approval of shareholders at the General Meeting) to the London Stock Exchange for the admission of the Placing Shares to trading on AIM. It is expected that Admission will occur and that dealings will commence on 12 December 2007 at which time it is also expected that the UK Placing Shares will be enabled for settlement in CREST.
Terms of the Placing Agreement
Pursuant to the Placing Agreement, Panmure Gordon & Co has agreed to use its reasonable endeavours to place the UK Placing Shares with placees selected by it.
The UK Placing is conditional upon, inter alia, the passing of a resolution at the General Meeting, Admission and on both the Placing Agreement and the US Subscription Agreements having become unconditional and not having been terminated in accordance with their terms prior to Admission. If the conditions of the Placing Agreement are not fulfilled or waived on or before 8.00 am on 12 December 2007 (or such later time and date as the Company and Panmure Gordon & Co may agree, being no later than 8.00 am on 21 December 2007) the UK Placing will not become unconditional and the placing monies will be returned to the placees, without interest, as soon as practicable thereafter.
Panmure Gordon & Co is entitled to terminate the Placing Agreement in certain circumstances prior to Admission, principally in the event that any of the warranties contained therein are, or become, materially untrue, inaccurate or misleading or if an event of force majeure arises.
In consideration of their services in connection with the UK Placing, the Company will pay to Panmure Gordon & Co a sales commission of 5 per cent. of the aggregate value, at the Placing Price, of those UK Placing Shares for which Panmure Gordon & Co procures subscribers, 2 per cent. of the aggregate value, at the Placing Price, of those UK Placing Shares for which the Company procures subscribers and 2 per cent. of the aggregate value, at the Placing Price, of the US Subscription Shares. The Placing Agreement contains warranties given by the Company with respect to the Group, its business and certain matters connected with the UK Placing.
Overseas shareholders
The UK Placing Shares have not been and will not be registered under the Securities Act or under the securities law of any state of the United States nor have they been qualified for sale under the securities legislation of any province or territory of Canada and the relevant exemptions are not being obtained from the securities commission of any province of Canada and accordingly, the UK Placing Shares may not, subject to certain exemptions, be offered, sold, taken up, delivered or transferred (directly or indirectly) and will, absent an applicable exemption, not qualify for sale within the United States or Canada or to, or for the account or benefit of, any person or corporation in (or with a registered address in) the United States or Canada.
The UK Placing Shares will not be lodged or registered with the Australian Securities and Investments Commission under Australia's Corporations Law and are not being offered for subscription or sale and may not be directly or indirectly offered, sold or delivered in or into Australia or for the account or benefit of any person or corporation in (or with a registered address in) Australia.
No document in relation to the UK Placing Shares has been or will be lodged for registration with the Registrar of Companies in the Republic of Ireland and the UK Placing Shares will not be offered, sold or delivered, directly or indirectly in the Republic of Ireland. All subscribers for UK Placing Shares must provide addresses outside the Republic of Ireland for the receipt of certificates for UK Placing Shares.
The relevant clearances have not been, and will not be, obtained from the Ministry of Finance of Japan and no document in relation to the UK Placing has been or will be lodged with or registered by the Ministry of Finance of Japan. The UK Placing Shares may not therefore be offered or sold, directly or indirectly, in or into Japan, its territories and possessions and any areas subject to its jurisdiction.
General
This announcement is the sole responsibility of the Company. Panmure Gordon & Co is acting as nominated adviser, broker and financial adviser to the Company and to no other person in relation to the Placing. Panmure Gordon & Co will not be responsible to any person other than the Company for providing the protections afforded to the customers of Panmure Gordon & Co nor for advising any person other than the Company on the transactions and arrangements referred to in this document.
These terms and conditions apply to persons making an offer to subscribe for UK Placing Shares under the UK Placing. Each person to whom these conditions apply, as described above, who confirms his agreement to Panmure Gordon & Co (on behalf of itself and the Company) to subscribe for UK Placing Shares (which may include Panmure Gordon & Co and/or its nominee(s)) hereby agrees with each of Panmure Gordon & Co and the Company to be bound by these terms and conditions as being the terms and conditions on which the UK Placing Shares will be issued under the UK Placing. A placee shall, without limitation, become so bound if Panmure Gordon & Co confirms to it by telephone (i) the Placing Price and (ii) its allocation (the "Confirmation") and Panmure Gordon & Co so notifies the Company's registrar on behalf of the Company.
Conditional on (i) the passing of the resolution at the General Meeting, (ii) Admission occurring on 12 December 2007 or such later date as the Company and Panmure Gordon & Co may agree (not being later than 21 December 2007), (iii) the Confirmation, each placee agrees to subscribe for the number of UK Placing Shares allocated to it, at the Placing Price. To the fullest extent permitted by law, each placee acknowledges and agrees that it will not be entitled to exercise any remedy of rescission at any time. This does not affect any other rights a placee may have. A conditional contract note will be dispatched as soon as possible following the Confirmation.
Each placee undertakes to pay the Placing Price for the UK Placing Shares issued to such placee in such manner as shall be directed by Panmure Gordon & Co. Liability for stamp duty and stamp duty reserve tax is described below. In the event of failure by any placee to pay as so directed, the relevant placee shall be deemed hereby to have appointed Panmure Gordon & Co or any nominee of Panmure Gordon & Co to sell (in one or more transactions) any or all of the UK Placing Shares in respect of which payment shall not have been made as directed by Panmure Gordon & Co.
By participating in the UK Placing, each placee irrevocably represents, warrants and undertakes to Panmure Gordon & Co (for itself and as agent of the Company) that:
(a) it and/or each person on whose behalf it is participating (in whole or in part) in the UK Placing or to whom it allocates its UK Placing Shares in whole or in part:
(i) has the capacity and authority and is entitled to enter into and perform its obligations as a subscriber of UK Placing Shares and will honour such obligations; and
(ii) has fully observed all laws of relevant jurisdictions and obtained all necessary governmental or other consents in either case which may be required in relation to the subscription by it of UK Placing Shares;
(b) it is not a person who is resident in, or a citizen of, the United States, Canada, Australia, the Republic of Ireland or Japan (or an agent or nominee of such a person) or a corporation, partnership or other entity organised under the laws of any such jurisdiction (or an agent or nominee of such a person);
(c) it is a Relevant Person;
(d) in agreeing to subscribe for UK Placing Shares it has received and read this document including this appendix and is not relying on any information, representation or warranty relating to the UK Placing, UK Placing Shares or the Company other than as contained in this document and it has not relied on and is not relying on any representation or warranty or agreement by Panmure Gordon & Co or the Company or any of their respective directors, employees or agents or any other person except as set out in the express terms herein;
(e) save where Panmure Gordon & Co has been given prior written notice to the contrary, in participating in the UK Placing it is acting as principal and for no other person and that its acceptance of that participation will not give any other person a contractual right to require the issue by the Company of any of the UK Placing Shares;
(f) it irrevocably confirms Panmure Gordon & Co's discretion with regard to the Placing Agreement and agrees that Panmure Gordon & Co does not owe it any fiduciary duties in respect of any claim it may have relating to the UK Placing;
(g) it acknowledges that the UK Placing Shares have not been and will not be registered under the Securities Act or under the securities laws of any State of the United States, that the relevant clearances have not been and will not be obtained from the Securities Commission of any province of Canada and that the Ordinary Shares have not been and will not be registered under the securities laws of Australia, the Republic of Ireland or Japan and, therefore, the UK Placing Shares may not, subject to certain exceptions, be directly or indirectly offered or sold in the United States, Canada, Australia, the Republic of Ireland or Japan;
(h) it acknowledges and agrees that neither it nor any affiliate, nor any person acting on its or any affiliate's behalf, has or will offer, sell, take up, renounce, transfer or deliver directly or indirectly any UK Placing Shares within the United States, Canada, Australia, the Republic of Ireland or Japan or offer, sell, take up, renounce, transfer or deliver in favour of a resident of the United States, Canada, Australia, the Republic of Ireland or Japan unless permitted under applicable law;
(i) it has not offered or sold and will not offer or sell any UK Placing Shares in the United Kingdom prior to Admission except in circumstances which have not resulted and will not result in an obligation to publish an approved prospectus arising under section 85(1) of the FSMA or a breach of such section;
(j) it has complied with all relevant laws of all territories, or obtained all requisite governmental or other consents which may be required in connection with its participation in the UK Placing; that it has complied with all requisite formalities and that it has not taken any action or omitted to take any action which will or may result in Panmure Gordon & Co, or the Company or any of its directors, officers, agents, employees or advisors acting in breach of the legal and regulatory requirements of any territory in connection with the UK Placing or its application; that it is not in a territory in which it is unlawful to make an offer to subscribe for UK Placing Shares; and that it will pay any issue or other taxes due under any relevant non-UK laws;
(k) it acknowledges and agrees in connection with its participation in the UK Placing that Panmure Gordon & Co is not acting for it in relation to the UK Placing or otherwise and that Panmure Gordon & Co will not have any duties or responsibilities to it for providing the protections afforded to its customers or for advising it with regard to the UK Placing or the UK Placing Shares, nor do the contents of this announcement constitute the giving of investment advice by Panmure Gordon & Co to it;
(l) it has obtained all necessary consents and authorities to enable it to give its commitment to subscribe for UK Placing Shares and to perform its obligations as set out herein;
(m) save where Panmure Gordon & Co has been given prior written notice to the contrary, it is not a person falling within subsections (6), (7) or (8) of sections 67 or 70 or subsections (2) and (3) of section 93 or subsection (1) of section 96 of the Finance Act 1986 (or an agent or nominee of such person);
(n) save where Panmure Gordon & Co has been given prior written notice to the contrary, the issue of UK Placing Shares to it (whether as principal, agent or nominee) will not be subject to stamp duty or stamp duty reserve tax at the increased rates referred to in sections 67 or 93 (Depositary Receipts) or sections 70 or 96 (Clearance Services) of the Finance Act 1986;
(o) in the case of a person who confirms to Panmure Gordon & Co on behalf of a placee an agreement to subscribe for UK Placing Shares and/or who authorises Panmure Gordon & Co to notify the placee's name to the Company's registrar, that person represents and warrants that he has authority to do all such acts on behalf of the placee;
(p) to the extent that a placee is subscribing for UK Placing Shares on behalf of a third party and prior written notice of such matter has been given to Panmure Gordon & Co as contemplated by paragraph (e) of this appendix;
i. such placee has carried out applicable procedures to verify the identity of
such third party for the purposes of the Money Laundering Regulations 2003
(the "Regulations");
(ii) such placee has complied fully with its obligations pursuant to the Regulations; and
(iii) such placee will provide Panmure Gordon & Co on demand with any information it might require for the purposes of verification under the Regulations;
(q) it is aware of, has complied with and will comply with its obligations in connection with money laundering under the Proceeds of Crime Act 2002; and
(r) it acknowledges that the issue of the UK Placing Shares to it will be issued subject to the terms and conditions set out herein.
In the event that a placee is not able to give the warranties in (m) and (n) above, stamp duty or stamp duty reserve tax may be chargeable or may be chargeable at a higher rate: neither Panmure Gordon & Co nor the Company will be responsible for any resulting liability to stamp duty or stamp duty reserve tax, which shall be for the account of the placee and in respect of which the Placee agrees to indemnify, and keep indemnified, Panmure Gordon & Co and the Company.
Each placee irrevocably appoints any director of Panmure Gordon & Co as its agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the UK Placing Shares offered to it;
Settlement of the transactions in the UK Placing Shares following Admission will take place within the CREST system against Panmure Gordon & Co's CREST account 83801. The usual rules of secondary settlement and trading will apply.
Panmure Gordon & Co will endeavour to meet the demands of those placees indicating that they wish to hold their UK Placing Shares in certificated form.
In the case of a joint agreement to subscribe for UK Placing Shares, references to a placee in these terms and conditions are to each placee who is a party to such agreement and each such placee's liability is joint and several.
These terms and conditions and all documents and agreements into which these terms and conditions are incorporated by reference or otherwise validly form a part will be governed by and construed in accordance with English law. For the exclusive benefit of Panmure Gordon & Co and the Company each placee irrevocably submits to the exclusive jurisdiction of the English courts in respect of these matters. This does not prevent an action being taken against the placee in another jurisdiction.
LIDCO GROUP PLC