Last checked at 10 May 2017 07:00
10 May 2017
Provexis plc
Results of placing
Provexis plc ('Provexis' or the 'Company'), the business that develops, licenses and sells the proprietary, scientifically-proven Fruitflow® heart-health functional food ingredient, is pleased to announce it has raised a gross £350,000 via a placing (the "Placing"), conditional on admission to trading on AIM, of 70,000,000 new ordinary shares of 0.1p each (the "New Provexis Shares") with new and existing investors.
The New Provexis Shares have been issued at a gross 0.50p per share, and rank pari passu in all respects with the existing ordinary shares of 0.1p each in Provexis. No commissions or expenses will be payable on the issue of the New Provexis Shares.
The Placing represents a gross discount of 16.7 per cent to the closing mid-market price per Ordinary Share on 9 May 2017, being the latest practicable date prior to this announcement.
The Company's RNS announcement of 2 May 2017 confirmed that the Company was in late stage discussions with a small group of investors in relation to two subscriptions to raise further working capital for the Company, and the placing announced today completes the First Subscription.
The Company's announcement of 2 May 2017 stated that the company then had legally binding commitments in the First Subscription to raise £170,000 at a subscription price of 0.50 pence per ordinary share, and non-legally binding indications of interest in the First Subscription to raise approximately a further £30,000 at 0.50 pence per ordinary share. The £350,000 Placing announced today therefore represents a £150,000 increase over the £200,000 total interest from investors announced on 2 May.
The Company will receive the full £350,000 proceeds raised from the Placing announced today, which will be used to provide the Company with additional working capital to support its growth plans over the coming years, to include the research and collaboration agreement announced in April 2017 with BY-HEALTH for Fruitflow®.
Application will be made to the London Stock Exchange for the 70,000,000 New Provexis Shares to be admitted to trading on AIM. It is expected that the admission will become effective and that trading in the New Provexis Shares will commence on 16 May 2017 ("Admission").
Following Admission, the Company's enlarged issued share capital will comprise 1,820,818,174 ordinary shares with voting rights. The Company does not hold any shares in treasury. This figure of 1,820,818,174 ordinary shares may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.
Second Subscription - completion expected in June 2017
The Company's RNS announcement of 2 May 2017 also confirmed that the Company had applied to Her Majesty's Revenue and Customs ('HMRC') for advance assurance that it would be eligible to issue new ordinary shares under HMRC's Enterprise Investment Scheme ('EIS').
The Company has received positive EIS advance assurance clearance from HMRC on a number of previous occasions, most recently in July 2012, and it has previously issued shares under EIS. However, the EIS eligibility rules for companies and investors have undergone a number of changes in recent years hence the need to submit a new advance assurance application, as requested by a number of prospective investors in the planned Second Subscription.
The Directors currently have non-legally binding indications of interest in the Second Subscription to raise approximately £375,000 at a subscription price of 0.50 pence per ordinary share with no commissions or expenses payable, of which approximately £250,000 is likely to be subject to the Company receiving positive EIS advance assurance clearance from HMRC.
The Company's announcement of 2 May 2017 stated that the company then had non-legally binding indications of interest in the Second Subscription to raise approximately £370,000 at a subscription price of 0.50 pence per ordinary share, hence the revised non-legally binding indications of interest in the Second Subscription announced today represent a £5,000 increase over the £370,000 interest from investors announced on 2 May.
The process of obtaining full EIS advance assurance clearance from HMRC is likely to take some weeks, and the outcome from this process is currently uncertain given recent changes to the EIS eligibility rules for companies and investors. A further announcement concerning EIS and the related Second Subscription will be made by the Company in due course, likely in June 2017.
The Company highly values its private investor base and believes that it would be appropriate to provide private investors with an opportunity to participate in the Second Subscription at 0.50 pence per ordinary share through the Company's existing access to the PrimaryBid.com platform. Subscriptions through the PrimaryBid.com platform, which are expected to be eligible for EIS if the Company receives positive EIS advance assurance clearance from HMRC, will be considered by the Company on a 'first come, first served' basis subject to conditions, with any investment request over £40,000 first requiring the Company's consent. The Company will provide further details of this process in due course.
The Second Subscription, to include the PrimaryBid.com element of the Second Subscription, is not being underwritten.
Whilst the final amount which the Company can expect to receive from these Subscriptions cannot yet be determined, in part due to the currently uncertain outcome of the EIS advance assurance clearance process, total Subscriptions are currently expected to exceed £475,000, an amount which includes the £350,000 confirmed today from the completed First Subscription. If the Company receives positive EIS advance assurance clearance from HMRC total Subscriptions are currently expected to exceed £725,000.
Further announcements concerning the planned Second Subscription will be made by the Company at the appropriate time.
Dawson Buck, Chairman of Provexis, commented:
'The Board is pleased with the outcome of the First Subscription for £350,000 announced today, which has resulted in relatively little dilution to shareholders.
The Company is also pleased to report non-legally binding indications of interest in a Second Subscription to raise approximately £375,000, of which approximately £250,000 is likely to be subject to the Company receiving positive EIS advance assurance clearance from HMRC. The Company highly values its private investor base and it intends to provide private investors with an opportunity to participate in the Second Subscription at 0.50 pence per share through the PrimaryBid.com platform.
The total First and Second Subscriptions are currently expected to raise at least £475,000 in total, and if the Company receives positive EIS advance assurance clearance from HMRC total Subscriptions are currently expected to exceed £725,000.
The funds raised will be used to provide the Company with additional working capital to support its revenue growth plans over the coming years, to include the research and collaboration agreement announced in April with BY-HEALTH for Fruitflow, and they will considerably strengthen the Group's balance sheet.
The Company intends to issue a trading update later today, Wednesday 10 May 2017.'
This announcement contains inside information.
ends-
For further information please contact:
Provexis plc Tel: 07490 391888
Dawson Buck, Chairman enquiries@provexis.com
Ian Ford, Finance Director
Cenkos Securities plc Tel: 020 7397 8900
Bobbie Hilliam
Notes for editors
About Provexis plc
AIM-listed Provexis is focused on the development and licensing of its proprietary, scientifically-proven Fruitflow® heart-health functional food ingredient.
In May 2009, the Company's Fruitflow® technology was the first to be substantiated by the European Food Safety Authority ("EFSA") under the new Article 13(5) for proprietary and emerging science. In December 2009 the European Commission authorised the health claim "Helps maintain normal platelet aggregation, which contributes to healthy blood flow", which was the first wording to be authorised under Article 13(5).
In June 2010 it was announced that the Company had entered into a long-term Alliance Agreement with DSM Nutritional Products to commercialise Fruitflow®, and in June 2015 the Company confirmed it had agreed significantly enhanced financial terms for its Alliance Agreement with DSM for Fruitflow®.
The Company's Alliance partner DSM Nutritional Products has developed the market actively for the Company's novel, patented Fruitflow® heart-health ingredient in all global markets, with over 50 regional consumer healthcare brands now having been launched by direct customers of DSM, and with a number of further regional brands having been launched through DSM's distributor channels.
An increasing number of further commercial projects have been initiated by DSM with prospective customers, including some prospective customers which are part of global businesses, with good prospects for these projects to be launched as consumer products. Interest in the technology exists in all major global markets.
In June 2016 the Company launched a high quality dietary supplement product containing Fruitflow® and Omega-3 which is being sold initially from a separate, dedicated website www.fruitflowplus.com on a mail order basis.
The Company conducted a Key Opinion Leaders' roundtable event for Fruitflow® in London on 29 September 2016, focussed on raising awareness of the importance of blood flow in cardiovascular health, and the effectiveness of dietary antiplatelets. The roundtable was attended by key scientists from Provexis and DSM, along with a number of interested health care professionals with close links to the media. The event was recorded and a video for Fruitflow® + Omega-3 capsules targeting prospective consumers can be seen here www.youtube.com/watch?v=P3HCSdyupEY&t=48s
The Company and DSM are keen to secure greater medical advocacy for Fruitflow® and the roundtable event forms part of this strategy.
The roundtable event is being supported by a broader consumer PR campaign, and the Company's Fruitflow® + Omega-3 dietary supplement product has featured in a number of recent articles in the UK national press which can be seen here www.fruitflowplus.com/fruitflow-in-the-media
The Company has been engaged in a two stage collaboration agreement with the University of Oslo to undertake further research into the relationship between Fruitflow® and blood pressure regulation. In December 2016 the Company announced the results from the second stage of the collaboration, a pilot study which indicated that a standard dose of Fruitflow® in powder format significantly lowered average 24-hour systolic blood pressure compared to placebo. Both systolic and diastolic blood pressure were shown to be significantly lower whilst trial subjects were awake, a clinically relevant reduction in blood pressure which is expected to be of interest to a large number of consumers and patients with a wide range of cardiovascular conditions.
In April 2017 the Company announced that it had entered into a memorandum of understanding with BY-HEALTH Co., Ltd ('BY-HEALTH') which is intended to result in a research and collaboration agreement with BY-HEALTH for Fruitflow®. The Company also confirmed separately that Provexis and DSM are working with BY-HEALTH to support the planned launch of some Fruitflow® based products in the Chinese market, with the first launch envisaged in the second half of 2017.
BY-HEALTH is a substantial Chinese listed dietary supplement business which is currently valued in excess of £1.7bn.
Provexis was founded in 1999 and is headquartered in Reading, Berkshire.
Provexis shares are traded on the AIM market of the London Stock Exchange under the ticker symbol PXS.
For further information, please visit www.provexis.com