Summit Therapeutics raising $50m, plans to delist from AIM
By Josh White
Date: Friday 06 Dec 2019
(Sharecast News) - Antibiotic innovation company Summit Therapeutics announced a proposed fundraising of about $50m through a subscription and placing of new ordinary shares and warrants to existing investors on Friday, which would be subject to certain shareholder approvals being obtained and certain customary closing conditions being satisfied.
The AIM-traded firm said the transaction included proposals to restructure its board of directors, and to cancel the trading on AIM of its ordinary shares.
It said its American Depositary Shares (ADSs) would remain listed on the Nasdaq stock market, where one ADS represents five ordinary shares.
On the fundraising, the company said $50m before expenses would be raised through a subscription of 166,157,050 new ordinary shares, and the placing of 9,221,400 new ordinary shares at a subscription and placing price of 22.1p each.
The subscription shares were being subscribed for by existing shareholder Robert Duggan.
Upon completion of the proposed fundraising, Duggan would control around 72.78% of the company's enlarged share capital.
The board said the placing involved the subscription of the placing shares by two placees, being an existing institutional shareholder, and its chief executive officer Glyn Edwards.
In addition, a total of 26,306,765 warrants were proposed to be granted to the subscription and placing participants, providing for the right to subscribe for a total of 26,306,765 ordinary shares at a premium of 10% to the offer price.
At the same time, Summit proposed that its board would be restructured to support preparations for the potential commercial launch of its lead product candidate, 'ridinilazole', for the treatment of C. difficile infection.
Conditional on the fundraising being completed, Robert Duggan, Manmeet Soni, Elaine Stracker and Ventzislav Stefanov had been appointed as non-executive directors, and Frank Armstrong, Leopoldo Zambeletti and David Wurzer had agreed to step down from the board, Summit confirmed.
It added that Glyn Edwards would take the role of chairman in addition to his existing role as CEO.
As a condition of the fundraising, it proposed that the admission of the company's ordinary shares to trading on AIM would be cancelled.
The company's ADSs would remain listed on Nasdaq, and the board said the proposed AIM delisting reflected the increasing focus of Summit's business operations on the United States and, specifically, its plan to commercialise ridinilazole in the US with its own specialised sales force that it planned to establish.
Summit's directors believe that if the fundraising was completed, the net proceeds of the subscription and the placing, together with its existing cash resources and funding agreements, would extend its cash runway to 31 January.
The company said it expected to use those funds to support a number of activities, including the continued patient enrolment into the 'Ri-CoDIFy' phase 3 clinical trial programme of ridinilazole for the treatment of Clostridium difficile infection.
It would also be used for preparatory activities to support the commercial launch of ridinilazole, if approved, as well as the development of early-stage research projects using its 'Discuva' platform, and general corporate purposes.
"Patients need new and better antibiotics. Innovation is required to develop distinctive new drugs that address the resistance crisis without damaging our healthy microbiomes," said CEO Glyn Edwards.
"Summit sees a huge opportunity in the antibiotic space for precision drugs targeting specific bacteria.
"We have great technology and people at Summit to bring forward potent antibiotics with the potential to deliver better outcomes for patients and healthcare systems."
Edeards said it was "great" that Bob Duggan was leading the "much-needed investment" into Summit, that would support the progression of its plans, including developing ridinilazole.
"We have the opportunity to show that ridinilazole is superior to vancomycin in sustained cures of C. difficile infection, is able to preserve the microbiome of patients and offers substantial benefits to payors by reducing costly recurrences."
At 1509 GMT, shares in Summit Therapeutics were down 6.97% at 20.7p.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN