TIDMVELA
RNS Number : 5437C
Vela Technologies PLC
20 October 2020
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED
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DISTRIBUTION WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY
SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR
CONTAIN ANY INVITATION, SOLICITATION, RECOMMATION, OFFER OR ADVICE
TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY
SECURITIES OF VELA TECHNOLOGIES PLC IN ANY JURISDICTION IN WHICH
ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.
20 October 2020
Vela Technologies plc
("Vela" or "the Company")
GBP2.35 million investment in potential COVID-19 treatment for
diabetic patients
Placing to raise GBP1.25 million
Highlights
-- Vela (AIM: VELA) has acquired an economic interest in a
late-stage Phase II therapeutic project to develop a potential
coronavirus treatment for diabetics
-- Strategic partners in the project include, amongst others, a
major global pharmaceutical company, UKRI - UK Research and
Innovation, Professor Sir Christopher Evans and Mubadala - the UAE
sovereign wealth fund
-- Following completion of a GBP10.3 million investment in
August 2020, the project is now fully funded with results of
current Phase II trial expected in Q2 2021
-- Consideration of GBP2.35 million satisfied by Vela raising
GBP1.25 million via a placing of new ordinary shares at 0.065 pence
per share and the issuance of 1,100,000,000 locked-in consideration
shares at a price of 0.1 pence per share
Introduction
The Board of Vela is pleased to announce that it has entered
into an agreement (the "Agreement") with St George Street Capital
Limited ("SGS" or "St George Street"), whereby Vela has acquired an
economic interest in the potential commercialisation of SGS's asset
to treat individuals with diabetes who are suffering with
COVID-19.
In addition, the Company announces that it has raised GBP1.25
million (before expenses) by way of a placing of 1,923,076,923 new
ordinary shares in the Company (the "Placing Shares") at a price of
0.065 pence per Placing Share (the "Placing Price") (together "the
"Placing"). The net proceeds of the Placing will be used to satisfy
the cash consideration payable to SGS under the Agreement, further
details of which are set out below. The Placing has been undertaken
pursuant to the Company's existing share authorities.
Further information on St George Street
St George Street is a UK-based medical-charity led by a group of
highly decorated academics and ex-pharma executives formed to
deliver much needed treatments to patients. SGS's strategy is to
take clinical-ready assets from pharmaceutical companies and to
progress them through Phase II medical trials, before licensing
them on for Phase III trials and commercialisation in order to
create a return for investors and the charity alike.
Under an agreement entered into in August 2019, SGS has acquired
the right to develop and commercialise two assets from a major
global pharmaceutical company, one of which includes the licence to
a drug that could be beneficial to diabetic patients suffering with
COVID-19 (the "Asset"). Diabetics have significantly higher
mortality compared with non-diabetic patients in COVID-19 and in
clinical studies this drug, SGS002, has been found to be safe in
almost 1,000 patients with diabetes and has a blood glucose
lowering effect for four months. Blood glucose control has been
proposed as a key factor in reducing complications from COVID-19 in
diabetics.
SGS is proposing to recruit up to 150 patients for a clinical
trial to test SGS002, which it estimates will take 5 months to
complete. SGS is working to a compressed timescale given the
urgency of the COVID-19 situation and anticipates reaching clinical
stage in early May 2021.
Details of the Agreement with St George Street
Pursuant to the agreement entered into between SGS and the major
global pharmaceutical company, there are two potential
commercialisation routes, being a reacquisition of the Asset or a
sub-licensing of the rights to a third party.
Under the terms of the Agreement, pursuant to either
commercialisation route for the Asset, SGS will pay Vela 8 per
cent. of proceeds received by SGS in excess of GBP19.2 million and
after deduction of sums payable to the major pharmaceutical company
and certain funders, and provision for taxation (the "Economic
Interest"). Vela's Economic Interest shall be renegotiated should
SGS receive further funding from third parties in the future.
Under the terms of the Agreement, Vela will pay consideration of
GBP2.35 million to SGS for the Economic Interest. Of the
consideration payable, GBP1.1 million will be satisfied by the
issue of 1,100,000,000 new ordinary shares in Vela (the
"Consideration Shares"), at a price of 0.1p per Consideration
Share, being a premium of 56.9 per cent. to the Company's closing
mid-market price of 0.06375 pence on the day prior to this
announcement. The Consideration Shares will be subject to a lock-in
agreement until the successful completion of Phase II of the trial,
named ARCADIA, or for a period of two months following completion
of the ARCADIA trial, should the outcome of the trials not meet the
minimum threshold. The remaining consideration of GBP1.25 million
will be paid by Vela to SGS in cash, funded from the net proceeds
of the Placing and from the Company's existing cash resources.
On completion of the investment SGS will hold 1,100,000,000
ordinary shares in Vela representing 9.37 per cent. of the issued
share capital of the Company, as enlarged by the Placing and the
issue of the Consideration Shares.
Details of the Placing
The Company has raised GBP1.25 million via the placing of
1,923,076,923 new ordinary shares in the Company at the Placing
Price. The net proceeds of the Placing will be used to satisfy the
cash consideration payable to SGS under the Agreement.
The Placing Price represents a premium of approximately 2 per
cent. on Vela's closing mid-market price of 0.06375 pence on 19
October 2020, the day prior to this announcement.
The Placing Shares have been placed by Peterhouse Capital
Limited, as agent and broker to the Company, with certain existing
and new investors.
In addition, 961,538,461 warrants to subscribe for new ordinary
shares in the Company (the "Placing Warrants") are to be granted to
subscribers in the placing, whereby each subscriber will receive 1
warrant for every 2 Placing Shares subscribed for. The Placing
Warrants are exercisable at a price of 0.15 pence per Placing
Warrant and will be exercisable until 23 October 2021. The Placing
Warrants will not be admitted to trading on AIM or any other stock
market and will not be transferable.
Admission and Total Voting Rights
Application will be made to the London Stock Exchange for the
Placing Shares and the Consideration Shares to be admitted to
trading on AIM.
It is expected that the Placing Shares will be admitted to
trading on AIM on or around 23 October 2020 and it is expected that
the Consideration Shares will be admitted to trading on AIM on or
around 26 October 2020. Following admission to trading on AIM of
the Placing Shares and the Consideration Shares ("Admission"), the
Company will have 11,737,404,749 ordinary shares of 0.01p each in
issue, each with one voting right. There are no shares held in
treasury. Therefore the Company's total number of ordinary shares
and voting rights will be 11,737,404,749 and this figure may be
used by Shareholders from Admission as the denominator for the
calculations by which they will determine if they are required to
notify their interest in, or a change to their interest in, the
Company under the FCA's Disclosure Guidance and Transparency
Rules.
James Normand, Executive Director of Vela, commented:
"Vela is pleased to have been invited to participate in such a
prestigious and genuinely ground-breaking project as this and is
delighted to invest alongside internationally respected
stakeholders such as Professor Sir Christopher Evans, UKRI and
Mubadala. The Board of Vela looks forward to providing shareholders
with news on the outcome of these trials as this highly regarded
team pursues its quest for a drug to provide a therapeutic
treatment for the effects of COVID-19 on diabetic patients."
MAR
The Market Abuse Regulation (MAR) became effective from 3 July
2016. Market soundings, as defined in MAR, were taken in respect of
the Placing with the result that certain persons became aware of
inside information, as permitted by MAR. That inside information is
set out in this announcement has been disclosed as soon as possible
in accordance with paragraph 7 of article 17 of MAR. Therefore,
those persons that received inside information in a market sounding
are no longer in possession of inside information relating to the
Company and its securities.
For further information, please contact:
Vela Technologies plc Tel: +44 (0) 7421
Brent Fitzpatrick, Non-Executive Chairman 728875
James Normand, Executive Director
Allenby Capital Limited (Nominated Adviser Tel: +44 (0) 20
and Joint Broker) 3328 5656
Nick Athanas / Asha Chotai
Peterhouse Capital Limited (Joint Broker) Tel: +44 (0) 20
7469 0930
Lucy Williams / Duncan Vasey / Eran Zucker
About Vela Technologies
Vela Technologies (AIM: VELA) is an investing company focused on
early stage and pre-IPO long term disruptive technology
investments. Following the investment announced today there will be
seven investments in the portfolio which have either developed ways
of utilising technology or are in the process of developing
technology with a view to disrupting the businesses or sector in
which they operate. More recently, Vela Technologies has broadened
its focus to include existing listed companies where valuations may
offer additional opportunities.
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END
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