Arovella completes $4m placement & launches $1m SPP
Arovella Therapeutics Ltd (ASX: ALA) (Arovella or the Company), a biotechnology company focused on developing its invariant Natural Killer T (iNKT) cell therapy platform, is pleased to announce that it has received firm commitments from institutional and sophisticated investors, to raise approximately A$4.1m (before costs) under a placement of 91,111,111 new fully paid ordinary shares in the Company (Shares) at a price of A$0.045 per share (Placement). The pricing of the Placement represents a 10% discount to the last traded market price and a 12.4% discount to the volume weighted average price (VWAP) of Arovella Shares traded on ASX over the five days up to and including 2 June 2023.
The Placement received strong support from institutional and sophisticated investors.
Following completion of the Placement, Arovella will offer existing shareholders the opportunity to participate in a non-underwritten Share Purchase Plan (SPP) to raise a further A$1 million (before costs). The issue price of the new Shares under the SPP will be the same as the price of the Shares issued under the Placement, being A$0.045 per Share.
Funds raised under the Placement and SPP will be used to progress Arovella’s lead product, ALA-101, towards a Phase 1 clinical trial for patients with CD19-positive Non-Hodgkin’s lymphoma. It will also be used to strengthen Arovella’s iNKT cell therapy pipeline and provide general working capital.
Over the coming 18 months, Arovella expects to achieve several critical milestones, including:
Reporting initial animal data on ALA-101 in combination with Imugene’s onCARlytics (H2 CY23);
Optimising and scaling-up its CAR-iNKT manufacturing process suitable for phase I clinical trials, including completing cGMP manufacture of its lentiviral vector (H2 CY23);
Completing Investigational New Drug (IND)-enabling non-clinical safety and efficacy studies (H1 CY24);
Manufacturing clinical batches for phase I clinical trials (H1 CY24);
Securing an Investigational New Drug (IND) application with the FDA and/or regulatory filing with TGA to conduct a phase I clinical trial in Non-Hodgkin’s lymphoma (H2 CY24); and
Commencing a phase I clinical trial in Non-Hodgkin’s lymphoma (H2 CY24)
Arovella’s Chairman, Dr Tom Duthy, said: “Arovella is working in one of the most important cancer therapeutic areas, cell therapies. The company is well-positioned to be a leader in the iNKT cell space, which shows great promise for the generation of an off-the-shelf product. We are delighted with the support from investors in the Placement, which provides us with funding to accelerate the development of our lead product, ALA-101 toward clinical trials.”
Arovella Managing Director and CEO Michael Baker said: “It has been a challenging period for the sector so to have the level of support that we received is outstanding. This is an exciting time for Arovella. The company has repositioned itself and we can now focus on driving ALA-101 into clinic. We look forward to building on our success and creating value for all our shareholders.”
Placement
Under the terms of the Placement, the Company has secured firm commitments for, and proposes to issue, a total of 91,111,111 Shares to Placement subscribers at a price of A$0.045 per Share.
The offer price under the Placement represents:
a 10% discount to the last closing price of Shares traded on the ASX on Friday 2 June 2023, being A$0.05; and
and a 12.4% discount to the volume weighted average price (VWAP) of Shares traded on the ASX over the 5 days up to and including 2 June 2023.
The new Shares under the Placement will be issued under Arovella’s existing placement capacities pursuant to ASX Listing Rules 7.1 and 7.1A. Specifically, the Company will issue 15,592,342 Shares under the Company’s Listing Rule 7.1 capacity, and 75,518,769 Shares under its Listing Rule 7.1A capacity.
Settlement of the Placement is expected to occur on Tuesday, 13 June 2023, with allotment to occur on Wednesday, 14 June 2023.
The new Shares issued under the Placement will rank equally with the Company’s existing fully paid ordinary shares. The Company will apply for quotation of the Placement Shares on ASX.
Blue Ocean Equities acted as Lead Manager with Baker Young as Co-Lead Manager for the Placement.
Share Purchase Plan
Following completion of the Placement, Arovella will offer existing eligible shareholders the opportunity to participate in a non-underwritten SPP, to raise approximately A$1 million.
Under the SPP, eligible Arovella shareholders, being shareholders with a registered address in Australia and New Zealand on the Company’s share register as at 7:00pm (AEST) on Tuesday, 6 June 2023, and who are not in the United States or acting on account or benefit of a person in the United States will have the opportunity to apply for up to A$30,000 of new Shares per eligible shareholder.
The issue price of the new Shares under the SPP will be same as the price of Shares issued under the Placement, being A$0.045 per Share. The SPP will provide eligible shareholders with the opportunity to increase their shareholdings in the Company, without incurring brokerage fees or other transaction costs.
The SPP offer will open on Thursday, 15 June 2023, and close on Thursday, 29 June 2023.
Full details of the SPP will be set out in an SPP offer booklet, which is expected to be released to the ASX and dispatched to eligible shareholders on Thursday, 15 June 2023. The SPP will be subject to the terms set out in the SPP offer booklet.
The SPP aims to raise approximately A$1 million, being 22,222,222 New Shares. Arovella may accept applications (in whole or in part) that result in the SPP raising more or less than the targeted amount of A$1 million in its absolute discretion (subject to the ASX Listing Rules). Applications may be subject to scaleback.