FGN Futuragene

 

TIDMFGN 
 
RNS Number : 3621D 
Futuragene PLC 
01 December 2009 
 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITED 
STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF IRELAND OR SOUTH AFRICA 
 
 
FUTURAGENE PLC 
 
 
Placing to raise GBP3 million 
 
 
1 December 2009.  FuturaGene PLC ("FuturaGene", or the "the Group", AIM: FGN), a 
leader in plant genetic research and development for global forestry, biofuel 
and agricultural markets, has raised GBP3 million by way of a placing (the 
"Placing").  Further details of the Placing are set out below under the heading 
"Details of the Placing". 
 
 
Placing highlights 
  *  6,000,000 new ordinary shares (the "New Shares") have been placed with new 
  institutional and existing institutional and private shareholders at 50 pence 
  per New Share (the "Issue Price") raising gross proceeds of GBP3 million 
  *  6,000,000 warrants to subscribe for new ordinary shares at an exercise price of 50 pence per ordinary share (the "Exercise Price") have also been granted to the placees of the New Shares on a ratio of 1 to 1 with the New Shares (the "Warrants").  These Warrants will potentially raise an additional GBP3 million for the Group.
 
  *  Introduction of major new shareholder, Hartford Growth (Trading) Fund Limited who will hold approximately 5.34 per cent of the issued share capital of the Company following the placing.
 
  *  Subject to certain exceptions, the Warrants become exerciseable on 30 November 2010 and expire on 14 December 2010
 
  *  3,000,000 of the Warrants (the "Conditional Warrants") are conditional upon shareholder approval being obtained for the requisite authorities under the Companies Act 2006 in order for the Conditional Warrants to become exerciseable. A general meeting is expected to be convened by the end of January 2010 for the purpose of obtaining such approval.  
 
  *  The Issue Price and the Exercise Price each represents a discount of approximately 13.80 per cent to the closing mid market price of 58 pence of the existing ordinary shares in FuturaGene on 30 November 2009, the latest practicable date prior to this announcement.
 
  *  The net proceeds of the Placing will be used for working capital and R&D needs, including the acceleration of the Group's eucalyptus partnerships and the exploitation of opportunities in the poplar biopower markets in the USA and China 
 
 
 
Background to the Placing 
 
 
As stated in the Group's interim results published on 29 September 2009, 
FuturaGene has made significant progress in its aim to be the leading source of 
plant genetic solutions for the global forestry, biofuel and agriculture 
industries. Recent milestones include the exercise of commercialisation options 
between the Group and IIBRD, a subsidiary of a major forestry group, and an 
extension of the Group's agreement with the Research Institute of Tropical 
Forestry (RITF) of China, for the development of growth-enhanced eucalyptus. 
 
 
The Group expects commercial planting of trees containing its genetic material 
within the next two to three years through its activities in Brazil with Suzano, 
with associated royalty payments. The Group has additional development 
partnerships and license agreements which are progressing at projected pace 
through the development pipeline towards commercialization. 
 
 
Use of funds 
 
 
The gross proceeds of the Placing are GBP3 million and the net proceeds are 
expected to be approximately GBP2.97 million. The proceeds will enable 
FuturaGene to continue and accelerate its research and development activities on 
strategic crops including eucalyptus and poplar. 
 
 
The Group anticipates that the proceeds will provide sufficient funding for its 
current planned activities for the next 18 months. 
 
 
Details of the Placing 
 
 
The Placing consists of 6,000,000 units divided into two tranches of 3,000,000 
units each. The first tranche of 3,000,000 units consists of one New Share at 50 
pence per share (the "Issue Price") and one Warrant to subscribe for one 
ordinary share at 50 pence per share (the "First Tranche"). The second tranche 
of 3,000,000 units consists of one New Share at 50 pence per share and one 
Conditional Warrant to subscribe for one ordinary share at 50 pence per share 
(the "Second Tranche"). 
 
The Placing is subject to the New Shares forming part of the units being 
admitted to AIM. Application has been made to the London Stock Exchange for the 
6,000,000 New Shares to be admitted to trading on AIM and it is expected that 
admission will occur on 7 December 2009 ("Admission"). 
 
 
Following Admission the Company will have 56,222,239 ordinary shares in issue. 
The New Shares will rank pari passu in all respects with the existing ordinary 
shares and will represent 10.67 per cent of the Company's enlarged issued share 
capital. 
 
 
The entire First Tranche of the Placing is being subscribed by Hartford Growth 
(Trading) Fund Limited which is a fund based in the Bahamas managed by Tiresias 
Capital Cayman Limited. Upon completion of the Placing, Hartford Growth will 
hold 3,000,000 ordinary shares of the Company, representing 5.34 per cent of the 
enlarged issued share capital of the Company. The Second Tranche of the Placing 
is being subscribed by a mix of new and existing institutional and private 
investors. 
 
 
The Conditional Warrants (being the Warrants comprised in the Second Tranche of 
the Placing) are being granted conditional upon shareholder approval being 
obtained for the requisite authorities under the Companies Act 2006 for them to 
be granted on a non pre-emptive basis. A general meeting is expected to be 
convened by the end of January 2010 for the purpose of obtaining such approval. 
 
 
The Warrants comprised in the First Tranche and, subject to the requisite 
authorities having been obtained, the Conditional Warrants, become exerciseable 
on 30 November 2010 (being the anniversary of the relevant warrant instrument 
constituting the Warrants) (the "Exercise Date") and expire on 14 December 2010, 
being the day which is two weeks following the date on which they become 
exerciseable) (the "Expiry Date"). The Warrants will also become exerciseable in 
the event that a Liquidity Event (as defined below) occurs prior to the Expiry 
Date. For this purpose, a Liquidity Event means the occurrence of the sale of 
all or substantially all the assets and undertaking of the Company or the Group; 
or any event whereby the shareholders of the Company on 30 November 2009 cease 
to be the beneficial owners of at least 50% of the shares conferring voting 
rights in the Company from time to time. The Warrants contain customary 
provisions requiring adjustment of their number and/or the Exercise Price in the 
event of changes to the Company's share capital. 
 
 
The  Placing  is  not  being  offered  on  a pro rata basis to existing 
Shareholders .The  Directors  believe  that  raising new funds by way of the 
Placing is the most  appropriate  method  of funding the Company at the present 
time.  The Board considers that a general offer to existing Shareholders by way 
of rights or other pre-emptive issue is not appropriate at this stage of the 
Company's development due to the significant additional costs that would be 
incurred and the delay that would be caused by  the production and approval of a 
prospectus. 
 
 
Dr. Stanley Hirsch, Chief Executive FuturaGene commented: 
 
 
"Today's oversubscribed fund raising shows the confidence investors have in our 
strategy and the opportunities we have to grow the business rapidly, 
particularly given our leading capabilities to develop plant genes to increase 
yield, rate of plant growth and alleviate damage to crops caused by 
environmental stresses such as drought. 
 
 
"In a world where pressure on land and water resources is increasing, these 
funds will ensure we are very well positioned to continue to provide 
sustainable, ecologically sound technologies to enhance and protect plant yields 
in rapidly developing fields such as biomass for biopower and new generation 
biofuels" 
 
Enquiries: 
 
 
+-------------------------------------+------------------------------+ 
| FuturaGene Plc                      |                              | 
+-------------------------------------+------------------------------+ 
| Mark Pritchard, Chairman            |         +44 (0) 7802 827 846 | 
+-------------------------------------+------------------------------+ 
| Dr. Stanley Hirsch, Group Chief     |             +972 544 56 2724 | 
| Executive                           |                              | 
+-------------------------------------+------------------------------+ 
|                                     |                              | 
+-------------------------------------+------------------------------+ 
| Evolution Securities                |                              | 
+-------------------------------------+------------------------------+ 
| Neil Elliot                         |         +44 (0) 20 7071 4300 | 
+-------------------------------------+------------------------------+ 
|                                     |                              | 
+-------------------------------------+------------------------------+ 
| College Hill                        |          +44 (0)20 7457 2020 | 
+-------------------------------------+------------------------------+ 
| Adrian Duffield/Rozi Morris         |                              | 
+-------------------------------------+------------------------------+ 
 
 
About FuturaGene PLC 
 
 
FuturaGene is a leader in plant genetic research and development for the global 
forestry, biofuel, and agricultural markets. The Group develops sustainable, 
ecologically sound technology to meet the ever increasing demands for fiber, 
fuel and food crops in the face of declining and deteriorating land and water 
resources. 
FuturaGene aims to be the leading crop technology company for biomass, second 
generation biofuel and biopower, through two main technology platforms: Cell 
Wall Modification, which helps crops grow faster, enhancing yield and 
processability; and Abiotic Stress Tolerance which enables plants to grow in 
harsh, dry, salty environments or protects yield when plants are stressed by 
these factors. 
The Group's most advanced technologies are for yield improvement in sustainable 
industrial forestry and it has strong partnerships with leading international 
forestry and agriculture companies, such as Suzano, Forage Genetics (Land 'O 
Lakes), China Academy of Forestry (CAF), AA Alliance and Targeted Growth. The 
Group has established broad applications of its technology in key crops 
including eucalyptus, poplar, alfalfa and corn. 
 More information is available at www.futuragene.com. 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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