AFT Pharmaceuticals raises $9.1M via redeemable share issue

Friday 17 March 2017 10:48 AM

AFT Pharmaceuticals raises $9.1M via redeemable share issue, announces SPP

By Rebecca Howard

March 17 (BusinessDesk) - AFT Pharmaceuticals, which manufactures the Maxigesic painkiller, raised new funds through a redeemable share issue to fuel international growth and announced plans to raise more capital in a share purchase plan.

The Auckland-based drug maker said the redeemable share issue raised approximately $9.1 million from CRG, a US health-care investor, and the Atkinson Family Trust at $2.74 per share, equal to the volume weighted average price of AFT's ordinary shares on the NZX over the last five business days. The issue is expected to be settled March 24 and the redeemable shares will not be listed. AFT's shares last traded at $2.70. Of that, CRG bought about $7.1 million and the Atkinson trust $2 million.

The redeemable shares don't carry voting rights and attract a 9.4 percent dividend per year at AFT's discretion, which can also choose to redeem them at any time two years after the issue. After three years, the holders can convert them to ordinary shares.

Proceeds will be used for AFT's current and planned R&D programme as well as taking advantage of the codeine rescheduling decision in its key Australian market, the company said.

The share issue is fundamentally about fueling international growth, said chief executive Hartley Atkinson. "This is really about making sure we take full advantage of the opportunities we have created for ourselves as a company right across North America, Europe, Asia and the Middle East."

He noted the development of key innovative products is proceeding well with the filing of Maxigesic tablets in the US in February. According to Atkinson, six new dose forms of Maxigesic are under development, more than the planned four. Clinical studies have also commenced on its patented NasoSURF drug delivery device. A further investigational new drug or IND application with the FDA is planned for this year for Pascomer, a treatment applied to skin to treat certain skin conditions, the company said.

"AFT does have an extensive R&D programme and this capital raise will help us complete the key stages, which will allow further licensing agreements to be made," Atkinson said.

AFT also plans to make an offer of ordinary shares to eligible shareholders through a share purchase plan. The aim is to give each eligible shareholders the opportunity to subscribe for at least $15,000 of shares. The company plans to announce the final terms of the plan when it releases its full-year result in May.

Separately the company said it expects total income to be between $69 million and $71 million for the full year, up from $65.8 million in 2016. It also said Maxigesic tablet sales for the financial year are expected to increase to 74 million tablets per annum, representing a 339 percent increase on the prior year.

(BusinessDesk)

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