Open Orphan announces proposed placing to raise up to £12 million

Open Orphan (ORPH FOLLOW) has announced that it intends to raise up to £12 million via a placing, a subscription to certain investors and an offer subscription of new Ordinary Shares for retail investors by PrimaryBid, all at a price of 11 pence per new Ordinary Share.

Fundraising Highlights:

• The accelerated bookbuild will raise up to £12m from Institutional investors
• Conditionally raised approximately £80,000 through the Subscription of 727,272 Subscription Shares to specific investors
• Will launch an offer for a subscription to be conducted by PrimaryBid for retail investors on a "first come, first served" basis

Use of Proceeds:

The net proceeds of the Fundraising will be used to:

• Maximise available Covid-19 opportunities including:
• Accelerate the development of both a seasonal coronavirus and a Covid-19 virus challenge study model to capitalise upon the group's inbound demand from Covid-19 vaccine developers globally. These challenge study models have the ability to accelerate development of a vaccine by 2-3 years.
• Ramp up Covid-19 antiviral testing to the group's current capacity for 3,000 tests per day.
• Expand existing laboratory testing services to 3rd party pharmaceutical and biotech companies in line with its strategy of becoming a leading services provider to the growing viral, and respiratory diseases sector of the pharmaceutical industry.
• Strengthen the balance sheet to enable the group to take advantage of the significant and growing opportunities the Board believes are available.

The issue price represents a discount of around 26.4% to the closing middle market price of 14.95 pence per Ordinary Share on 21 May 2020, being the latest practicable date prior to the publication of this Announcement.

However, the company also states the placing price is actually a premium of 3.8% to the closing price of 10.6 pence per Ordinary Share on 7 May 2020 being the date immediately before the announcement of the Quotient partnership on 11 May 2020.

The Fundraising

The Fundraising comprises a proposed placing, an offer for subscription through PrimaryBid and subscription of new Ordinary Shares to be affected in two tranches:

• 44,824,000 new Ordinary Shares will utilise the company's existing shareholder authorities to issue the Firm Placing Shares and the Firm PrimaryBid Shares on a non-pre-emptive basis for cash (the "Firm Fundraising")
• 70,000,000 new Ordinary Shares will be conditional on the passing of resolutions to grant authority to the Directors to allot the Conditional Placing Shares, Conditional PrimaryBid Shares and Subscription Shares for cash and to disapply statutory pre-emption rights at a General Meeting

Investors should be aware that the placing is subject to the satisfaction of certain conditions set out in the full announcement here and is being conducted by way of an accelerated bookbuild, which will be launched immediately.

General Meeting

The Company intends to publish and send a circular (the "Circular") to shareholders convening the General Meeting in connection with the issue of the Conditional Fundraising Shares on or around 26 May 2020.

A further announcement will be made following the close of the Bookbuild, confirming final details of the Placing.

Shares in ORPH opened down 14% to 12.88p following the placing announcement

ORPH price chart