LONDON (ShareCast) - (Sharecast News) - Medical device developer Creo Medical Group announced a fundraising of at least £25m net of expenses on Thursday, to progress its electrosurgical device programmes.
The AIM-traded company said it would issue new shares at a price of 20p each to institutional and other investors in an accelerated bookbuild that began earlier in the day.

It also proposed to raise up to £5.2m through an open offer, available to all qualifying shareholders on the record date.

The directors said they believed that, despite challenging macroeconomic conditions, 2022 was a year of significant operational progress for the group.

They said the fundraising was intended to enable Creo to progress to the next stage of developing and commercialising its minimally-invasive electrosurgical devices.

The board said it expected the fundraising to provide a pathway to being cash flow breakeven, and ultimately to profitability.

Creo said it was also aiming to increase its balance sheet strength.

The issue price of 20p represented a discount of 27.9% to the closing mid-market price of 27.8p on 15 February, and of 5.7% to the 30-day volume-weighted average price up to and including 15 February, of 21.2p.

Creo said the net proceeds would be used to provide the working capital required to accelerate the commercial roll-out of its core technology products in the US, EMEA, and Asia-Pacific regions.

They would also allow it to continue developing its pipeline of commercial licensing and partnering opportunities via its Kamaptive licensing program, expand and commercialise its range of Endotherapy consumable devices, and resolve its funding gap.

Completion of the fundraising remained conditional on shareholder approval at a general meeting pencilled on for 8 March.

"We're delighted to announce the launch of this funding round which will not only provide us with the working capital to accelerate the roll out of our core technology, but will also resolve the funding gap to provide us with a pathway to being cash flow breakeven and, ultimately, to profitability," said chief executive officer Craig Gulliford.

"Over the last year we have demonstrated rapid growth in the core technology and product revenues coming out of the pandemic."

Gulliford said the company had seen "excellent progress" across its clinical adoption, Pioneer training programme, new product launches and partnering projects, adding that its Kamaptive partnerships with Intuitive and CMR Surgical, where its products were being adapted for use with robotic-assisted surgical platforms, were progressing well.

"These funds will allow us to continue to support the commercial scaling up of our core technologies, expand our Kamaptive programme, which is focussed on large markets with significant growth potential, and develop our endoscopic suite of products for roll out on a global basis."

At the close on Thursday, shares in Creo Medical Group were down 11.71% at 24.5p.

Reporting by Josh White for Sharecast.com.

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE