TIDMDEMG
RNS Number : 9475A
Deltex Medical Group PLC
08 February 2022
08 February 2022
Deltex Medical Group plc
Subscription to raise approximately GBP1.4 million and extension
of Standby Debt Facility
Deltex Medical Group plc (the "Group", the "Company" or "Deltex
Medical") (AIM: DEMG), the global leader in oesophageal Doppler
monitoring, today announces:
i) subscription for 111,720,000 new Deltex Medical ordinary
shares (the "Subscription Shares") at a price of 1.25 pence per
share (the "Issue Price") (the "Subscription")
ii) extension of the Standby Debt Facility previously announced on 20 September 2021
Subscription
The Board has concluded that it is now appropriate to raise a
total of approximately GBP1.4 million by way of subscription for
111,720,000 Subscription Shares at a price of 1.25 pence per Deltex
Medical ordinary share ("Share"). This represents a 9% discount to
the closing mid-market Share price on 07 February 2022.
Certain directors of the Company, namely Nigel Keen, Julian
Cazalet, Mark Wippell, Natalie Wettler and Andy Mears, intend to
participate in the Subscription for, in aggregate, 32,610,400 new
Shares at the Issue Price.
Director / Current Pre-transaction Subscription Post transaction Post transaction
PDMR Shares held shareholding Shares holding %
Nigel Keen 79,852,821 13.60% 20,000,000 99,852,821 14.28%
------------- ---------------- ------------- ----------------- -----------------
Julian Cazalet 17,153,971 2.92% 10,000,000 27,153,971 3.88%
------------- ---------------- ------------- ----------------- -----------------
Mark Wippell 10,237,875 1.74% 800,000 11,037,875 1.58%
------------- ---------------- ------------- ----------------- -----------------
Andy Mears 5,858,731 1.00% 800,000 6,658,731 0.95%
------------- ---------------- ------------- ----------------- -----------------
Natalie Wettler - - 1,010,400 1,010,400 0.14%
------------- ---------------- ------------- ----------------- -----------------
The participation of each of Nigel Keen, Julian Cazalet, Mark
Wippell, Natalie Wettler and Andy Mears in the Subscription
constitutes a related party transaction under Rule 13 of the AIM
Rules for Companies. The independent directors, being Christopher
Jones and Tim Irish, having consulted with the Company's nominated
adviser, consider that the terms of the transaction are fair and
reasonable insofar as Deltex Medical's shareholders are
concerned.
Admission of the Subscription Shares to trading on AIM
("Admission") is expected to take place on or around 14 February
2022.
Reasons for the Subscription and use of proceeds
The proceeds from the Subscription will be used: (i) to launch,
market and commercialise the next generation TrueVue monitor as
well as a new non-invasive Doppler probe; (ii) to provide the
financial resources required to support the substantial grant
funding already won by the Group to enhance and advance its
haemodynamic monitoring technology; and (iii) for the general
working capital needs of the business.
The next generation TrueVue haemodynamic monitor replaces the
current version which was launched in 2012. This next generation
monitor will utilise modern electronics, benefits from a
significantly improved user interface, incorporates battery power,
is light-weight and highly portable, enabling it to be used in any
area within the hospital. The Board believes that these new and
improved features should significantly increase the addressable
market for the Group's technology.
In addition to the next generation TrueVue monitor, the Group
has also developed a new non-invasive Doppler device that can be
used on awake patients. The development of this technology draws
upon the substantial body of published research relating to the
Group's minimally-invasive haemodynamic monitoring device which is
already in use in surgery as well as intensive care units around
the world.
The new non-invasive device has been designed and is intended to
be sold into a broad range of hospital departments where the Group
is not currently present, including: Accident & Emergency;
pre-surgical assessment; obstetrics; cardiology and general medical
wards.
The Group believes that this new technology, used in conjunction
with the appropriate treatment protocols, will improve patient
outcomes, reduce hospital stays, help increase the efficiency of
healthcare workers and deliver significant savings to health
systems. It should also help facilitate the rapid diagnosis of
serious illness in COVID-19 patients and also enable rapid
identification of patients with sepsis.
On 20 December 2021, Deltex Medical disclosed a successful
application for the UK Smart Award by Innovate UK (GBP0.5 million
gross). This Innovate UK Smart Award relates to the development of
the innovative, hand-held, non-invasive Doppler device (described
above) for improved haemodynamic management of hospitalised
patients. During 2021, the Group was also awarded two other grants
by Innovate UK (GBP0.1 million gross in aggregate) including one to
help with the development of its new, real-time, easy-to-use,
non-invasive haemodynamic monitoring technology working
collaboratively with the UK's National Physics Laboratory.
Financial update and future prospects
As previously disclosed in the pre-close announcement of 11
January 2022, Group revenues for the year ended 31 December 2021
were GBP2.3 million (2020: GBP2.4 million). 2021 revenues continued
to be adversely affected by the impact of COVID-19 and the
resulting significant reduction in elective surgical procedures
globally. Deltex Medical's business experienced disruptions
associated with the pandemic for the entire year unlike trading in
2020 when the business in the first quarter was not so severely
affected. Although the Group's direct business in the USA and the
UK has not yet returned to pre-pandemic levels, the performance of
the International division significantly improved during the
year.
On 26 January 2022 the Group announced a US$0.2 million contract
win from one of its distributors in the Americas for the purchase
of the current generation TrueVue monitor. This contract award also
provides for on-going contracted monthly revenues for single-use
Deltex probes, which are used with these devices.
The backlog in elective surgical cases continues to build around
the world and this is increasingly becoming a political issue in
many territories. The Board continues to believe that this backlog
represents a key opportunity as the Group's TrueVue Doppler
technology can be used to help minimise patient length of stay, and
associated costs, following elective surgery and hence increase
capacity for hospitals.
Principal risks and uncertainties
A description of the principal risks and uncertainties
associated with the Group and its activities is set out on pages 20
and 21 of Deltex Medical's Annual Report and Accounts for the
financial year ended 31 December 2020. The Board believes that the
description of these principal risks and uncertainties remains
relevant and applicable to the Group at the date of this
Announcement.
Extension of Standby Debt Facility
On the 20 September 2021 the Board announced that it had entered
into an agreement with Imperialise Limited, a company controlled by
Nigel Keen, Chairman of Deltex Medical, for a GBP0.5 million
standby loan facility (on arm's length commercial terms) until 31
December, 2022. During the period of the loan, the Group could draw
down on the facility as and when required.
Imperialise Limited has agreed to extend this debt facility for
an additional year. The facility is repayable in full on or before
31 December 2023.
The interest rate remains unchanged on the facility at 8% per
annum, and it is unsecured.
Nigel Keen is a director of both Imperialise Limited and Deltex
Medical, and accordingly, this transaction constitutes a related
party transaction under Rule 13 of the AIM Rules for Companies. The
independent directors, being Andy Mears, Natalie Wettler, Julian
Cazalet, Mark Wippell, Christopher Jones and Tim Irish, having
consulted with the Company's nominated adviser, consider that the
terms of the transaction are fair and
reasonable insofar as Deltex Medical's shareholders are concerned.
Commenting on the Subscription, Nigel Keen, Chairman of Deltex
Medical said:
"This fund raising enables Deltex Medical to develop and launch
the next generation of its technology, including the new
non-invasive TrueVue Doppler with significantly broader
applications throughout hospitals."
"We believe that Deltex Medical will benefit this year from a
combination of the world learning to live with COVID-19 and
pressure continuing to build on health systems to reduce the
substantial backlog of elective surgical procedures."
"The Group's next generation monitor and new, novel non-invasive
haemodynamic monitoring technology should help position Deltex
Medical to build market share as the backlog in elective surgery is
tackled around the world."
For further information, please contact:
Deltex Medical Group plc 01243 774 837
Nigel Keen, Chairman investorinfo@Deltexmedical.com
Andy Mears, Chief Executive
Natalie Wettler, Group Finance Director
Nominated Adviser and Broker
Arden Partners plc 0207 614 5900
Paul Shackleton info@arden-partners.com
Benjamin Onyeama-Christie
Joint Broker
Turner Pope Investments (TPI) Ltd 0203 657 0050
Andy Thacker info@turnerpope.com
James Pope
Notes for Editors
Deltex Medical manufactures and markets haemodynamic monitoring
technologies which are primarily used in critical care and general
surgical procedures. Deltex Medical's proprietary oesophageal
Doppler monitoring (TrueVue Doppler) measures blood flow velocity
in the central circulation in real time. The technology generates a
low-frequency ultrasound signal which is highly sensitive to
changes in blood flow and measures such changes in 'real time'.
Deltex Medical is the only company in the enhanced haemodynamic
monitoring space to have built a robust and credible evidence base
demonstrating both the clinical and economic benefits of its core
technology: TrueVue Doppler. This technology has been proven in a
wide range of clinical trials to reduce complications suffered by
patients after surgery and consequently can save hospitals
money.
Clinicians would like to be able to monitor the haemodynamic
status of awake patients not only in the operating room and
intensive care departments. Our R&D programmes will provide the
capability for Deltex Medical devices to be used in A&E,
including, for example, for the rapid detection of sepsis, as well
as on lower acuity wards or outside the hospital setting.
Deltex Medical is designing the next generation of non-invasive
Doppler ultrasound devices that will be released onto the TrueVue
platform and will accurately measure a non-sedated patient's
haemodynamic status anywhere within the hospital and not just for
elective surgical patients.
Group goal
Haemodynamic management is now becoming widely accepted as a
vital part of the anaesthesia protocols for surgical patients, as
well as treating ventilated intensive care patients, including
ventilated COVID-19 patients. There is also a desire to start
measuring haemodynamics on awake patients outside of the operating
room or intensive care departments, such as in lower acuity units
or in A&E. Our R&D programmes are targeting these broader
applications. Consequently, the Group's focus is on maximising
value from the opportunities associated with: the COVID-19
pandemic; the elective surgery backlog; the risks associated with
sepsis; awake patients and the higher profile of haemodynamic
monitoring which has arisen from recent consolidation in the
sector.
The Group aims to provide clinicians with a modern, next
generation, single 'haemodynamic workstation' platform which offers
them a range of technologies from simple to sophisticated to be
deployed according to the patient's clinical condition as well as
the skill and expertise of the user. Doing this will enable the
Group to partner with healthcare providers to support modern
haemodynamic management across the whole hospital.
The Group is currently in the implementation phase of achieving
this goal in a number of territories worldwide, operating directly
in the UK and the USA, and via agreements with approximately 40
distributors overseas.
Notification of transactions by Directors, Persons Discharging
Managerial Responsibilities ("PDMRs") and persons closely
associated with them.
1. Details of the person discharging managerial responsibilities
/ person closely associated
a) Name a) Nigel Keen
b) Julian Cazalet
c) Mark Wippell
d) Andy Mears
e) Natalie Wettler
---------------------------------- ------------------------------------
2. Reason for the Notification
------------------------------------------------------------------------
a) Position/status a) Non-Executive Director
b) Non-Executive Director
c) Non-Executive Director
d) CEO
e) Finance Director
---------------------------------- ------------------------------------
b) Initial notification/amendment Initial notification
---------------------------------- ------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
------------------------------------------------------------------------
a) Name Deltex Medical Group plc
---------------------------------- ------------------------------------
b) LEI 213800XN34P6LI8J6M39
---------------------------------- ------------------------------------
4. Details of the transaction(s):section to be repeated for (i)
each type of instrument; (ii) each type of transaction; (iii)
each date; and (iv)each place where transactions have been conducted
------------------------------------------------------------------------
a) Description of the Financial Ordinary Shares of 1 p each
instrument, type of
instrument
---------------------------------- ------------------------------------
Identification code GB0059337583
---------------------------------- ------------------------------------
b) Nature of the Transaction Subscription for new shares
---------------------------------- ------------------------------------
c) Price(s) and volume(s) Price(s) Volume(s)
a) 1.25p 20,000,000
-----------
b) 1.25p 10,000,000
-----------
c) 1.25p 800,000
-----------
d) 1.25p 800,000
-----------
e) 1.25p 1,010,400
-----------
---------------------------------- ------------------------------------
d) Aggregated information n/a - single transaction
---------------------------------- ------------------------------------
e) Date of the transaction 08 February 2022
---------------------------------- ------------------------------------
f) Place of the transaction London Stock Exchange, AIM Market
(XLON)
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