Date: 2013-07-03
Type of information: Private placement
Company: Summit (UK)
Investors:
Amount:
Funding type: new share issue
Planned used: The new funds together with anticipated milestones from the existing Wellcome Trust agreement will support: (a) Development of the DMD programme - Phase 1b clinical trial of SMT C1100, manufacture of SMT C1100 drug product, long-term toxicology studies and biomarker programme. (b) Clinical development of the C. difficile Infection programme - manufacture of final drug product and conduct of the Phase 2 patient clinical trial. (c) Working capital and general corporate purposes.
Others: * On July 3, 2013, Summit, a drug discovery and development company has announced a share issue to raise £4.5 million (before expenses) through the issue of 90,750,000 new Ordinary Shares by way of a Placing at 5.0 pence per Ordinary Share to certain institutional investors and Directors. The Placing is being fully underwritten by Nomura Code Securities Limited on, and subject to, the terms of a placing agreement between the parties.
The issue price represents a premium of approximately 17.6 per cent. to the price of 4.25 pence per share, being the closing mid-market price of the Company’s Ordinary Shares on 2 July 2013.
Qualifying Shareholders will also be given an opportunity to participate in an Offer for Subscription of new Ordinary Shares at 5.0 pence per new Ordinary Share to raise up to GBP1.0 million in addition to the funds raised from the Placing.
Summit is developing utrophin modulator drugs as a treatment for Duchenne Muscular Dystrophy (‘DMD’). The Company’s lead candidate is SMT C1100 and it successfully completed a Phase 1 clinical trial in healthy volunteers during 2012. The next stage of development is progress into patient clinical trials. The Group currently does not have sufficient cash resources to fund the future development of this programme and as a consequence, the Group requires additional finance to enable its strategy for creating shareholder value to be implemented.
The Company’s second clinical programme developing a novel antibiotic to treat C. difficile infection (‘CDI’) is substantially funded by the Wellcome Trust. The proceeds of the Placing will enhance the Group’s financial position and provide it with sufficient cash resources to fund the business for at least the next 12 months. Any amounts raised from the Offer for Subscription would supplement the funds from the Placing potentially providing the Company with additional working capital.
If the Resolutions are not passed by Shareholders at the General Meeting, the Fundraising would be unable to proceed. In this situation, the Company would not have cash resources to fund the DMD programme or maintain current levels of working capital expenditure and would need to consider alternative strategic options that the Directors believe would not be in the best interests of stakeholders. These options could include raising finance from alternative sources, disposals of intellectual property assets, reducing costs through redundancies or other means or a sale of the Company at a price which the Directors believe would not recognise the potential long-term value of the business.
Therapeutic area: Rare diseases - Infectious diseases
