Verona Pharma Successfully Completes £3.25 Million Placing
Verona Pharma plc has announced that it has successfully completed a placing, conditional on admission and in part on shareholder approval, to raise gross proceeds of approximately £3.25 million.
The placing, which was arranged by WH Ireland Limited, involved the issue of up to 65,020,120 new ordinary shares at 5 pence per share. Up to 43,660,800 of these new ordinary shares have been placed firm (the “Firm Shares”) and up to 21,359,320 of these new ordinary shares (the “Conditional Shares”) have been placed conditional upon shareholder approval.
Application has been made for the new ordinary shares to be admitted to trading on AIM and dealings in the Firm Shares and the Conditional Shares are expected to commence on 14 December 2011 and 11 January 2012, respectively.
Following the placing of all of the new ordinary shares, the number of ordinary shares in issue will increase to 307,204,395.
The net proceeds of the placing will be used:
• to finance the ongoing RPL554 clinical trial programme, including a low dose response study planned to be completed by mid 2012, and a Phase II anti-inflammatory trial planned to be completed by late 2012. In the meantime, discussions related to the licensing of RPL554 continue;
• to finance further clinical trials with VRP700 to obtain vital dose response and duration of action data. These studies are planned to be initiated and concluded in 2012; and
• to meet ongoing corporate expenditures.
The Directors believe that the placing will provide Verona Pharma with sufficient working capital to finance the development programme described above, without taking into account any potential licensing income from RPL554.
Magic Bullet Enterprises Limited (“Magic Bullet”), a company controlled by Michael Walker, Chief Executive of Verona, and Clive Page, Chairman of Verona, has agreed to subscribe for 500,000 Conditional Shares at the placing price.
Under the AIM Rules, Magic Bullet is treated as a related party of the Company. The Directors, excluding Messrs Walker and Page by reason of their interest in Magic Bullet, consider, having consulted with WH Ireland, the Company’s nominated adviser, that the terms of the subscription by Magic Bullet are fair and reasonable insofar as shareholders are concerned.
A circular convening the general meeting to approve the placing of the Firm Shares is being sent to shareholders and a copy will be placed on the Company’s website shortly.
Michael Walker, CEO of Verona Pharma, stated: “This financing will enable us to substantially reinforce our RPL554 licensing package while continuing to expand our clinical knowledge base for VRP700. The Directors believe that progressing the development of our drug projects whilst pursuing partnering opportunities strengthens the Company’s negotiating position both by increasing the value of the projects and by making them more attractive to potential partners. Therefore, the studies planned for RPL554 and VRP700 have been designed with this in mind, at low cost and with short time lines.
The Directors are particularly pleased that Verona Pharma’s largest institutional shareholder, Henderson Global Investors, has supported the issue, increasing its overall interest in the Company.”