Placing and Notice of General Meeting

RNS Number : 7979G

Osirium Technologies PLC

06 March 2018

 

For immediate release

6 March 2018

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, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION (EU No. 596/2014) ("MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.

Osirium Technologies plc

("Osirium", the "Company" or the "Group")

Placing to raise £4.2 million

and

Notice of General Meeting

Placing

Osirium Technologies plc (AIM: OSI), UK headquartered cyber-security SaaS provider, is pleased to announce a placing to raise approximately £4.2 million (before expenses) through the issue of 3,144,931 new ordinary shares (the "Placing Shares") at a price (the "Placing Price") of 134 pence per Placing Share (the "Placing").

The Placing was conducted by Stifel Nicolaus Europe Limited ("Stifel") and the Placing Shares have been placed with institutional and other sophisticated investors, including existing shareholders.  The Placing is conditional, inter alia, on the approval of shareholders at a general meeting of the Company to be held on Friday, 23 March 2018 (the "GM" or "General Meeting") of a resolution to authorise the Directors to allot new ordinary shares in the capital of Osirium ("ordinary shares") otherwise than on a pre-emptive basis.

Further details of the Placing are set out below.

Chairman's Subscription

Concurrent with and conditional on the Placing, Simon Lee, Non-Executive Chairman of the Company, has agreed to subscribe for 14,925 new ordinary shares at the Placing Price to raise an additional £20,000 (the "Subscription").

Following the Placing and Subscription, Mr. Lee's shareholding will be:

Holding prior to the Subscription	Shares issued pursuant to the Subscription	Holding following the Placing and Subscription	Holding as a percentage of enlarged issued share capital
111,936	14,925	126,861	0.94%

Further details of the Subscription are set out below.

Rationale for the Placing and use of proceeds

The Company is seeking funding to:

·     scale the Group's business in the multi-billion dollar market for privileged access management (PAM) which is considered predominately greenfield and growing more than 25% p.a.;

·     invest further in its sales, marketing, and product development;

·     double the size of its engineering and R&D teams in 2018, which should allow it to continue to innovate, develop next-generation solutions and continue to displace in-house solutions and legacy products; and

·     strengthen Osirium's balance sheet and fund the Group's working capital requirements over the next twelve months and beyond.

Background to the Placing

Since its IPO in April 2016, Osirium has continued to focus on strengthening its sales, marketing, R&D and engineering teams.

The Group's sales director has been strengthening Osirium's direct sales capabilities while also building a broad channel network and transitioning the business from a passive to an active channel strategy.  The sales team now comprises four direct sales people, three pre-sales people and two sales consultants focused on delivering proof of concept software to, and converting, sales prospects, as well as expanding the Group's footprint within existing clients.  The marketing team is also up to full strength and is building Osirium's UK and global brand, lead generation capabilities including Osirium's internet presence, public relations and events.

The R&D and engineering teams are developing new technology further enhancing Osirium's next generation software solutions.  At the same time, Osirium's profile has increased considerably and has seen growing and positive industry recognition of its innovative approach, culminating in Osirium being named as a 2017 'Cool Vendor' by Gartner, the leading independent IT research firm, and the Osirium Platform being recognised by analysts KuppingerCole in their January 2018 Executive Report.

Gartner estimate that cyber-security spending was $89bn in 2017, growing at 8% per annum.  Privileged Access Management (PAM) is emerging as one of the fastest growing markets within the wider cyber-security market and is expected to grow at 27% p.a. to $2.3bn by 2020 by which time it will represent 2% of all cyber-security spending.  This anticipated growth will be supported by significant opportunities in the mid-market space.

Throughout this time, the Group's new customer wins, bookings and revenue streams have increased significantly, in line with the Directors' strategic objectives, to deliver a step change since Osirium's IPO.  In addition to the well-publicised increase in security threats globally, Osirium's growth has been underpinned by growing awareness of PAM as mission-critical IT infrastructure for the upper middle market as well as enterprise clients.  The onset of General Data Protection Regulation (GDPR) from May 2018, as part of increasing regulatory compliance standards, is also driving mainstream adoption across all industries.

Further details of the Placing

Under the Placing, the Company has conditionally raised £4.2 million (before expenses) through a placing of 3,144,931 ordinary shares at 134 pence per share with institutional and other sophisticated investors.  The Company has entered into a Placing Agreement with Stifel under which Stifel has agreed to use its reasonable endeavours to procure Placees for the Placing Shares at the Placing Price.  The Placing has not been underwritten.

The Placing Shares will represent approximately 23.2 per cent. of the enlarged share capital.  The Placing Price represents a discount of approximately 5 per cent. to the closing mid-market price on AIM of 141 pence per ordinary share on 5 March 2018, being the last dealing day prior to publication of this document.

The Company currently has limited authority to issue new ordinary shares for cash on a non-pre-emptive basis.  Accordingly, the Placing is conditional upon, inter alia, the passing of the resolution to be put to shareholders of the Company at the General Meeting to authorise the Directors to allot new ordinary shares otherwise than on a pre-emptive basis.  In addition, the allotment of the Placing Shares is conditional, inter alia, on the Placing Agreement becoming unconditional and not being terminated in accordance with its terms prior to Admission. It is expected that Admission of the new ordinary shares to AIM ("Admission") will take place on 28 March 2018.

The Placing Agreement contains, inter alia, customary undertakings and warranties given by the Company in favour of Stifel as to the accuracy of information contained in this announcement and other matters relating to the Company.  Stifel may terminate the Placing Agreement in specified circumstances prior to Admission, including, inter alia, for material breach of the Placing Agreement or breach of any warranties contained in it and in the event of certain force majeure events occurring.

The Placing is conditional upon, inter alia, Admission occurring by not later than 8.00 a.m. on 28 March 2018 (or such later time and/or date as the Company and Stifel may agree, not being later than 8.00 a.m. on 27 April 2018).  If such condition is not satisfied or, if applicable, waived, the Placing will not proceed.

The Placing Shares will be issued credited as fully paid and will rank pari passu in all respects with Osirium's existing ordinary shares, including the right to receive dividends and other distributions declared on or after the date on which they are issued.

It is expected that CREST accounts will be credited on the relevant day of Admission and that share certificates (where applicable) will be despatched within 5 working days of Admission.

Details of the Subscription

Concurrent with and conditional on the Placing, Simon Lee, Non-Executive Chairman of the Company, has agreed to subscribe for 14,925 new ordinary shares (the "Subscription Shares") at the Placing Price to raise an additional £19,999.50.

Application for Admission to AIM

Application will be made to the London Stock Exchange for the Placing Shares and the Subscription Shares to be admitted to trading on AIM.  It is anticipated that such admission will become effective and that dealings in the Placing Shares will commence at 08:00 a.m. on 28 March 2018.

General Meeting

A circular (the "Circular"), containing information in relation to the Placing and convening the General Meeting, to be held at the offices of Stifel Nicolaus Europe Limited, 4th Floor, 150 Cheapside, London EC2V 6ET at 11:00 a.m. on 23 March 2018, is expected to be sent to shareholders today.  At the General Meeting, Shareholders will consider a resolution, to be passed as a special resolution, to disapply Shareholders' statutory pre-emption rights which would otherwise apply to the allotment of the Placing Shares and the Subscription Shares.

The Circular will be available on the Company's website at https://www.osirium.com in due course.

Current trading

On 9 January 2018, Osirium confirmed that its trading has continued to improve year on year in line with expectations and, as a result, expects bookings for the year ended 31 December 2017 to be in line with market expectations.

The Board remains very confident in the Group's prospects and believes Osirium has a unique proposition and is well placed to prosper as cyber-security becomes an even greater priority for corporates globally.

Commenting on the placing, David Guyatt, Chief Executive Officer of Osirium Technologies plc said:

"We are building an increasingly strong pipeline of opportunities and the funds raised will help support our sales ambitions and provide the Group with the necessary working capital for its growth plans.  This is an exciting time for the Company and the Board is committed to ensuring momentum continues and is optimised as we look to move towards profitability and cash generation."

For further information:

Osirium Technologies plc	Tel: [phone]
David Guyatt, Chief Executive Officer Rupert Hutton, Chief Financial Officer www.osirium.com
Stifel Nicolaus Europe Limited (Nominated Adviser and Broker)	Tel: [phone]
Fred Walsh / Neil Shah / Kerstin Ursu
Yellow Jersey PR (Financial PR) Sarah Hollins	Tel: [phone]

About Osirium Technologies plc and its subsidiary, Osirium Limited, (together the "Group")

Osirium Technologies plc (AIM: OSI.L), is a UK headquartered cyber-security Software-as-a-Service ("SaaS") provider. The Group protects critical IT assets, infrastructure and devices by preventing targeted cyber-attacks from directly accessing Privileged Accounts, removing unnecessary access and powers of Privileged Account users, deterring legitimate Privileged Account users from abusing their roles and containing the effects of a breach if one does happen.

The Group has defined and delivered what the Directors view as the next generation PAM (Privileged Access Management) solution. The team has developed the concept of Virtual Air Gap to separate users from passwords, with Osirium's Privileged Task Management module further strengthening Privileged Account security and delivering impressive return on investment benefits for customers.

Founded in 2008 and with its headquarters in Reading, UK, Osirium was admitted to AIM in April 2016. For further information please visit www.osirium.com

Stifel, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting only for the Company in relation to the matters described in this announcement and accordingly will not be responsible to anyone other than the Company for providing the protections afforded to clients of Stifel, or for providing advice in relation to the contents of this announcement or any matter referred to in it.

This announcement has been issued by, and is the sole responsibility of, the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Stifel or by any of its affiliates or agents as to or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

 

END

 

 

MSCGMGGFNVDGRZG