£3m Equity Purchase Agreemen

RNS Number : 9732D

ValiRx PLC

11 December 2009

 



ValiRx PLC (AIM: VAL)

("ValiRx" or the "Company")

£3m Equity Purchase Agreement

Company secures access to additional capital as it continues to develop its 

 intellectual property into revenue

ValiRx, the AIM quoted developer of diagnostics and therapeutics for cancer, is pleased to announce that it has entered into a £3m Equity Line of Credit ("ELOC Facility") with US based Dutchess Opportunity Fund, II, LP, a Delaware limited partnership ("the Investor"). The ELOC Facility allows ValiRx, at its own discretion, to raise up to £3 million of equity capital in drawdown's over a two year period. 

Pursuant to each cash drawdown, new ordinary shares in the Company will be issued to the Investor at a discount of approximately 10 per cent. to the market price prior to drawdown. The maximum size of a drawdown is £100,000 or, if lower, an amount equal to 150% per cent of the value of the average daily volume in ValiRx shares multiplied by the volume weighted average price of the transactions in the 5 days immediately preceding the drawdown. Since the use of the ELOC Facility is entirely at ValiRx's discretion, the Company can control the timing, size and pricing levels for any drawdown and is not obliged to use the ELOC Facility. This provides the Company with the ability to access funding at short notice, as allowed under the terms of the ELOC Facility, which is required to progress the growth and development of the business.

As announced previously in the trading update on 25 November 2009, the Company has made progress on several fronts. This funding will allow the Company to follow opportunities in a controlled and timely manner with the aim of increasing the Company's IP and asset value.

The ValiMedix division has started trading and producing revenues and, following encouraging initial responses the company anticipates enhancing the product range to accelerate revenue growth. 

ValiRx Finland has recently agreed to terms to receive grants amounting to €76k to accelerate its personalised medicine diagnostic product development and launch. On passing certain milestones, the company has the option to apply for further funding in due course. 

Dr Satu Vainikka, Chief Executive Officer of ValiRx stated:

"We are extremely pleased to have attracted a respected new institutional investor to the ValiRx growth story.

ValiRx's goal in securing the ELOC Facility is to have in place a facility that will enable the Company to raise capital efficiently at higher valuations, as it develops the business on to the next stage and communicates positive progress. Having observed the successful use of the ELOC facility by a number of other AIM companies, we are confident that this facility will provide a useful funding instrument for ValiRx".

Managing Partner of Dutchess, Douglas Leighton stated:

"We are pleased to have the opportunity to fund the Company with it's growth efforts while they continue to make strides in their developments. We look forward to a long relationship."

About Dutchess:

Dutchess Capital is an investment manager which provides creative financing for promising, growth-stage companies. Founded in 2000, funds managed by Dutchess have made over $200 million in direct investments in companies which span a wide array of industries including; Telecom, Wireless Communications, Healthcare, Biotechnology, Healthcare, Internet, e-Commerce, Technology, Media, Oil & Gas, Defense, Homeland Security, Financial Services, Entertainment, Nuclear Sciences, Precious Metals, Manufacturing, Apparel, Textiles, Consumer Products and Alternative Energy.

For almost a decade Dutchess, has been a global leader in CSLoCs and has transacted in excess of $1.4 billion in such financings. The CSLoC is a creative financing structure by which publicly traded companies can raise capital quickly, efficiently and with less dilution than most traditional offerings.

For more information, please visit: www.dutchessopportunity.com

Enquiries: 

ValiRx Plc  www.valirx.com Dr. Satu Vainikka	Tel: [phone]
WH Ireland Limited (Nominated Adviser) Adrian Kirk	Tel: [phone]
First Columbus LLP John Nuttall / Michael Raber	Tel: [phone]

 

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