Developer of innovative medical devices PolyNovo [ASX:PNV] has successfully completed its $30 million Institutional Placement made up of about 15.8 million shares priced at $1.90 each.
The developer has taken its latest equity-raising success as an expression of support for accelerating its growth in the US and globally, hoping to reach regions across Canada, India, and Hong Kong.
The PNV share price continued to sit at $1.90 by Wednesday afternoon, a 9.09% drop on its last closing price of $2.09, thanks to the completed Institutional Placement and trading halt enforced yesterday.
Over the past full year, PolyNovo’s share price increased nearly 34%, despite an 11% drop over the last week alone.
It’s up 43% in its sector and 36% compared with the wider ASX 200.
PolyNovo’s $30 million institutional placement
PVN has announced its successful closure of the $30 million Institutional Placement, consisting of around 15.8 million shares at $1.90 each.
The medical device developer took the recent success as a show of strong support from its shareholders and institutional investors found locally and abroad, giving it validation to use the funds for further growth into global markets.
Funds will also fast-track construction initiatives, boost manufacturing, and R&D for the company’s proposed office facility in Port Melbourne.
These commitments will be issued as new shares according to listing rules, settlement to occur on Monday, 28 November, for trade on 21 December.
A conditional placement will also be put to PVN directors to raise a further $3 million, subject to shareholder approval to be sought in the new year.
PVN revealed that one of its directors has already expressed the desire to contribute via the SPP (Share Purchase Plan), a non-underwritten arrangement to raise around $17.0 million, which opens on 30 November and will run until 13 December.
PolyNovo’s CEO Swami Raote commented on the company’s finalised placement:
‘We are delighted to have received such strong demand from a number of our existing institutional shareholders who continue to support PolyNovo, and we welcome a number of new institutional investors as we continue on our journey to improve patient outcomes.
‘Proceeds from the equity raising will allow us to continue to capitalise on the significant opportunities available to us including geographic sales team and indication expansion, investment in R&D and the development of a new facility to satisfy the growing demand for NovoSorb.’
PolyNovo’s Chairman David Williams also commented:
‘This equity raising demonstrates investor recognition of our strategy and high conviction that now is the time to accelerate our global growth. We have proven we can manage the significant growth we are seeing in the business so now is the time to step up that growth.’
Strong demand for PVN drives FY23
The company’s push for raising extra funds via recent equity raising methods is to assist its growth in the US, markets beyond, and its new office in Port Melbourne.
This, the company says, represents necessary expansion needed to meet the significant increase in demand for the company’s NovoSorb product.
Yesterday, PolyNovo revealed solid demand for its NovoSorb product led a record September quarter with revenue in excess of $5 million.
This momentum has reportedly spilled into November.
While PVN is profitable within its key US market, the biotech believes the company will be all-round profitable in FY24 — even with the costs involved in manifesting that growth.
‘The Age of Scarcity’
High demand, rising prices, and supply woes inflated by the war in Ukraine have turned energy into an inescapable topic.
But the rising cost of energy is part of a wider story, according to our resident commodities specialist James Cooper.
James says he’s ‘convinced the gears are in motion for another multiyear boom in commodities’.
A boom where Australia (and ASX stocks) stands to benefit.
To get the scoop on how this is to unfold, you can grab the report, or watch the video here.
For The Daily Reckoning Australia