TIDMLPX
RNS Number : 7316L
Lipoxen PLC
04 August 2011
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (DIRECTLY OR
INDIRECTLY) IN WHOLE OR IN PART IN, INTO, WITHIN OR FROM THE UNITED
STATES, AUSTRALIA, CANADA, JAPAN, NEW ZEALAND AND THE REPUBLIC OF
SOUTH AFRICA OR ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION.
ALL TERMS ARE DEFINED AT THE BACK OF THIS ANNOUNCEMENT, UNLESS
OTHERWISE DEFINED HEREIN.
4 August 2011
LIPOXEN PLC ('Lipoxen' or the 'Company')
SUBSCRIPTION FOR 110,800,000 NEW ORDINARY SHARES BY SYNBIO LLC
AT A PLACING PRICE OF 11 PENCE PER SHARE
ACQUISITION OF SYMBIOTEC GmbH
APPROVAL OF WAIVER OF THE OBLIGATION TO MAKE AN OFFER UNDER RULE
9 OF THE CITY CODE
AGREEMENT WITH THE SERUM INSTITUTE OF INDIA LTD
PROPOSED CHANGE OF NAME AND ARTICLES OF ASSOCIATION
AND
GENERAL MEETING
Lipoxen (AIM: LPX.L), the bio-pharmaceutical company
specialising in the development of high-value differentiated
biologic drugs and vaccines, is pleased to announce a series of
transformational transactions that include a significant financing,
the acquisition of patent-protected orphan drug candidates and
accelerate the launch of EMA/FDA clinical trials of a number of its
proprietary drug candidates.
Highlights:-
-- Strategic Investment - Placing with SynBio LLC ("SynBio") of
110.8 million ordinary shares in the capital of the Company at an
issue price of 11 pence per share, to raise GBP12.19m (before
expenses). SynBio will also be granted five-year warrants over the
shares in the capital of the Company representing up to 11,080,000
ordinary shares at a price of 33 pence per share, representing a
premium of 256 per cent., to the closing mid-market price on 3
August 2011.
-- Placing at a substantial premium - The Placing is being
carried out at a premium of 18.9 per cent. to the closing
mid-market price of an ordinary share on 3 August 2011.
-- Sovereign fund major investment partner - SynBio is a
newly-formed Russian company whose majority shareholder will be the
multi-billion dollar Russian state-owned nanotechnology investment
company, Russian Corporation of Nanotechnologies
(www.Rusnano.com).
-- Co-Development Agreement - Lipoxen will enter into a
comprehensive Co-Development Agreement with SynBio. Through this
agreement Lipoxen will license into Russia six product candidates
to efficiently exploit its technologies and establish human proof
of concept in advance of initiating EMA/FDA clinical trials. The
Directors believe that this strategy will mitigate the technical
and commercial risks of future drug development.
-- Acquisition - The Company intends to acquire the entire
issued share capital of SymbioTec GmbH ("SymbioTec") for a total
consideration of GBP8.8 million, which is to be satisfied by the
issue of 80 million new ordinary shares in the capital of the
Company.
-- Orphan drug candidates and new technology platform -
SymbioTec is a company registered in Germany and has a portfolio of
patents around a naturally occurring platform technology, histone,
which has potential application across a broad spectrum of cancers.
SymbioTec is in clinical development for its patent-protected lead
drug candidate, OncoHist(TM), a treatment of acute lymphocytic
leukaemia ("ALL") and acute myeloid leukaemia ("AML"), which has
been granted orphan drug status by both the FDA and the EMA.
SymbioTec's license partner is currently conducting a Phase IIb
clinical trial in Russia involving up to 120 patients in late stage
relapsed or resistant AML. The Company hopes that Phase IIb
clinical trials will be completed by the end of 2013. Upon
completion of Phase IIb clinical trials, Lipoxen's license partner
plans to file for market launch.
-- Agreement with Serum Institute of India Ltd ("SIIL") -
Lipoxen has entered into a Master Agreement to consolidate and
refine the Company's commercial arrangements with SIIL. This will
include the surrender back to the Company of the development rights
of up to 14 drug candidates, and uplift the Company's economic
interests in ErepoXen(R).
-- New share subscription by SIIL - SIIL is subscribing for 2.5
million new ordinary shares in the capital of the Company at an
issue price of 11 pence per share and will be granted two-year
warrants over the shares in the capital of the Company representing
up to 7.5 million shares at an average exercise price of 20 pence
per share.
-- Open offer - Following completion of the Placing and
Acquisition, the Company is proposing to raise up to approximately
GBP1.95 million (before expenses) through a proposed Open Offer to
existing shareholders. Further details of the Open Offer, detailed
timetable and an Application Form will be posted to Qualifying
Shareholders in due course.
-- Substantial funding for future clinical and operational
development- Funds from the Placing, Serum Subscription and Open
Offer are expected to raise up to GBP14.4m (before expenses) and
are expected to be sufficient to fund the Company's drug
development initiatives and operational requirements for two years
following implementation of the Proposals.
-- Change of Name - The Directors believe that the Proposals
represent a transformational step forward for Lipoxen and, as such,
the Company proposes to change its name to "Xenetic Biosciences
plc".
-- Notice of General Meeting - Lipoxen will hold a General
Meeting at the offices of Pinsent Masons LLP, 30 Crown Place,
London, EC2A 4ES at 11:00 a.m. on Thursday 1 September 2011.
Commenting on the Proposals, M. Scott Maguire, CEO of Lipoxen,
said:
"As previously communicated, Management has actively explored a
number of opportunities that, with the overall objective of
reducing its dependence on third parties, would allow the Company
to control its destiny through proprietary drug development, the
acquisition of complementary natural platform technologies, and the
acquisition of new product candidates with near-term
commercialisation potential.
We are therefore delighted to announce these proposals to
shareholders and believe this series of transformational
transactions will afford the Company independence as a specialty
drug developer with high-value orphan drug product candidates which
have shorter term market launch potential."
Enquiries:
Lipoxen plc +44 (0)20 7389 5015
M. Scott Maguire, Chief Executive
Officer
Singer Capital Markets (NOMAD
& Broker) +44 (0)20 3205 7500
Jeff Keating / Claes Spang
Walbrook PR +44 (0)20 7933 8780
Paul McManus / Bob Huxford (Media Enquiries)
Dr Paul Cornelius (Investor Enquiries)
Important Notice
Singer Capital Markets Limited, which is authorised and
regulated in the United Kingdom by the Financial Services
Authority, is acting exclusively for the Company in relation to the
Proposals and will not be responsible to any person other than the
Company under the Financial Services and Markets Act 2000, the
rules of the Financial Services Authority or otherwise for
providing the protections afforded to its clients or for advising
any other person in relation to the contents of this Announcement,
the Proposals or any matter, transaction or arrangement referred to
in this Announcement. Singer Capital Markets Limited is not making
any representation or warranty, express or implied, as to the
contents of this Announcement.
City Capital Corporation Limited, which is authorised and
regulated in the United Kingdom by the Financial Services
Authority, is acting exclusively for the Company in relation to the
Proposals and will not be responsible to any person other than the
Company under the Financial Services and Markets Act 2000, the
rules of the Financial Services Authority or otherwise for
providing the protections afforded to its clients or for advising
any other person in relation to the contents of this Announcement,
the Proposals or any matter, transaction or arrangement referred to
in this Announcement. City Capital Corporation Limited is not
making any representation or warranty, express or implied, as to
the contents of this Announcement.
The Directors accept responsibility for the information
contained in this Announcement other than the information for which
responsibility is taken by the directors of SynBio as referred to
below. To the best of the knowledge and belief of the Directors
(who have taken all reasonable care to ensure that such is the
case) the information contained in this Announcement is in
accordance with the facts and there is no omission likely to affect
the import of such information.
The directors of SynBio accept responsibility for the
information contained in this Announcement relating to each member
of the Concert Party and their related interests and the statements
attributed to them in respect of their intentions and conduct. To
the best of their knowledge and belief (having taken all reasonable
care to ensure that such is the case) such information contained in
this Announcement is in accordance with the facts and there is no
omission likely to affect the import of such information.
Shareholders of the Company are advised to read carefully the
Circular in relation to the Proposals once it has been despatched.
Copies of the Circular will, from the date of posting to the
Shareholders of the Company, be available for inspection at the
offices of Pinsent Masons LLP, 30 Crown Place, London, EC2A 4ES
during normal business hours on any weekday (Saturdays, Sundays and
public holidays excepted).
Capitalised terms in this announcement are defined in Part 4
hereof.
PART 1
Introduction
The Company proposes to raise GBP12.19 million before expenses
via the Placing with SynBio at an Issue Price of 11 pence per
Ordinary Share, representing a premium of 18.9 per cent to the mid
market price of an Ordinary Share on 3 August 2011, being the last
practicable date prior to release of this Announcement.
The Company also proposes to undertake a series of associated
transactions alongside the Placing that will, if completed, result
in significant changes to the Group's business and provide the
financial stability to initiate a number of material clinical
developments in the Group's product pipeline.
As part of the Proposals, in addition to the Placing, the
Company:
-- intends to acquire the entire issued share capital of
SymbioTec; and
-- has entered into a Master Agreement with SIIL in order to
consolidate and refine the Company's commercial arrangements with
SIIL.
Given the transformational nature of the Proposals, the Company
also proposes to change its name to "Xenetic Biosciences plc" and
to adopt new articles of association at the General Meeting which,
amongst other things, reflect changes to the UK company law regime
as a result of the final implementation of the Companies Act 2006.
Immediately following completion of the Placing the Company intends
to make an Open Offer which will enable Qualifying Shareholders to
participate at the Issue Price alongside the new incoming investor
to raise up to GBP1.95 million(before expenses). Further
information, the terms and conditions, an Application Form and a
detailed timetable in relation to the Open Offer will be sent to
Qualifying Shareholders in due course.
The Placing and the Acquisition are each conditional, amongst
other things, on the approval by Shareholders of the relevant
Resolutions, and Independent Shareholders only in the case of the
Independent Shareholder Resolution, proposed at the General
Meeting. The purpose of this Announcement is to provide details of
the Proposals. A circular in relation to the Proposals will be
dispatched to Shareholders today providing details of the Proposals
and convening a General Meeting at which the Resolutions required
to effect the Proposals will be proposed.
Background to and Reasons for the Proposals
As stated in the last Chairman's letter, the Company undertook
in 2010 to actively explore a number of opportunities, including
the acquisition of complementary natural platform technologies, the
acquisition of new product candidates with near term
commercialisation potential, and obtain a level of funding that
would allow proprietary drug development to reduce dependence on
third parties.
The Proposals represent the result of the Directors' endeavours
to meet these objectives and provide the platform for a series of
transformational changes to enable the Company to propel into the
clinic a number of potentially blockbuster and high-value orphan
drug product candidates.
As a consequence of the Proposals, the Company will be
positioned to take direct control of its own destiny as a specialty
drug developer as opposed to remaining a pure outlicensing company
which relies on delivery by external partners and as a result the
Company expects significantly to reduce its dependence on third
party collaborators. The Directors will however still seek
outlicensing deals along the lines of the Company's collaboration
with Baxter Healthcare and where appropriate, will entertain offers
for pipeline candidates.
The Directors believe the Proposals are the core catalyst
required to transform the Company's business, and the funds being
raised now are greater than the aggregate of all of the equity
capital raises completed by the Company since its admission to AIM
in January 2006.
The Company expects to mitigate the technical and commercial
risks of drug development by working in close collaboration with an
important new Russian-based collaboration partner, SynBio, which is
entering into the Co-Development Agreement with the Company under
which SynBio will be responsible for driving six new product
candidates through human proof of concept trials in Russia as
primary validation for the initiation of EMA/FDA clinical trials by
the Company. The Co-Development Agreement will operate alongside
the current arrangements which the Company has entered into with
Pharmsynthez where a further six product candidates are undergoing
clinical development in Russia with the same overall commercial
objectives.
The nature of the Company's business is that, as a platform
technology enterprise with an established base of pre-clinical and
clinical validation of its technologies, particularly in the case
of PolyXen, the Company's technologies are expected to have wide
application in the fields of biologic drugs and vaccines.
As such, the product potential for these technologies means that
it is commercially unlikely that the Company will seek to pursue
all development opportunities on its own account. Accordingly,
outlicensing remains an important part of the Company's strategy
for building shareholder value, albeit that, operating from a
position of much-increased financial stability, the Company will
seek demanding fiscal and operational deliverables from any future
licensees.
Sources and Uses of Funds
As a result of the Proposals and the proposed Open Offer, the
Company expects to raise up to GBP14.42 million before expenses
(assuming the proposed Open Offer is taken up in full but before
the exercise of any warrants or options over Ordinary Shares).
The Directors believe the aggregate net proceeds of the
Proposals and the proposed Open Offer will be sufficient to fund
the Group's development for the foreseeable future, that is, for
the two years following implementation of the Proposals and the
proposed Open Offer.
The principal application of funds is expected to be as
follows:
-- Initiate development, and clinical efforts in Europe and/or
an FDA-regulated territory on three proprietary Lipoxen product
candidates: Polysialyiated EPO ("ErepoXen"), Polysialyiated G-CSF
("StimuXen") and Histone H1.3 ("OncoHist").
-- Develop the Company's in-house product development and
commercialisation capabilities by contracting with manufacturing
organisations to conduct the concomitant drug development
processes.
-- Expand laboratory operations to enhance the Company's
capabilities to better support the design and execution of all
steps necessary for the range of clinical trials about to be
undertaken, as well as preparing new product candidates from the
Company's pipeline to be brought forward for clinical and
commercial development.
-- Fund the working capital requirements of the Group as
enlarged by the Proposals.
The Company will also continue to actively seek grant funding in
both Europe and the US (primarily in relation to orphan drug
candidates).
Information on the Placing and SynBio
The Placing relates to the 110,800,000 SynBio Shares, which will
represent approximately 30.09 per cent. of the issued share capital
as enlarged by the Placing and the Acquisition. The Placing will
raise GBP12.19 million before expenses (GBP11.29 million after
expenses).
The SynBio Shares will be placed with SynBio pursuant to the
provisions of the Subscription Agreement and will be held by SynBio
subject to lock in arrangements for 24 months following completion
of the Placing and orderly marketing arrangements for a further 24
months thereafter.
SynBio is a newly formed Russian limited liability company which
will, immediately following completion of the Placing and the
Acquisition, be owned by Rusnano, a Russian state owned and
sponsored biotechnology and nanotechnology investment company, HSCI
(a company quoted on MICEX which is engaged principally in stem
cell research) and Dmitry Genkin (a Director of the Company) and
entities associated with him. Together these parties are part of
the Concert Party that has been formed to establish SynBio and to
effect the Placing.
Conditional on completion of the Placing, SynBio and the Company
have agreed to enter into the Co-Development Agreement (described
above in "Background to and Reasons for the Proposals") and the
Relationship Agreement (described in the section headed
"Relationship Agreement" below).
Immediately following completion of the Placing and the
Acquisition, SynBio is expected to hold 184,831,461 Ordinary
Shares, representing 50.19 per cent. of the issued share capital of
the Company as enlarged by the Placing and the Acquisition.
Following completion of the proposed Open Offer, the issue of the
SIIL Consideration Shares and the issue of the SIIL Subscription
Shares, and assuming the Open Offer is taken up in full in due
course, SynBio would hold 46.50 per cent. of the issued share
capital of the Company as enlarged by the Proposals and the
proposed Open Offer.
As part of the Placing arrangements, the Company has granted the
SynBio Warrants, under which SynBio may, in the period commencing
two years from the date of completion of the Placing and for three
years thereafter, require the Company to issue up to 11,080,000 New
Ordinary Shares at an exercise price of 33 pence per Ordinary
Share. The SynBio Warrant Instrument provides that SynBio may
exercise the SynBio Warrants only to the extent the total number of
Ordinary Shares held by it and the Concert Party as a result of the
exercise of the SynBio Warrants do not exceed 50 per cent. of the
then issued ordinary share capital of the Company.
In the event that the SynBio Warrants are exercised in full on
30 September 2013 (being the second anniversary of Completion), the
total number of Ordinary Shares held by SynBio would be
195,911,461, representing approximately 47.95 per cent. of the
issued share capital of the Company after Third Closing as enlarged
by the Ordinary Shares issued pursuant to the SynBio Warrants.
Accordingly, SynBio will become, and remain for the foreseeable
future, a significant strategic shareholder in the Company, and
will for so long as it holds 40 per cent. or more of the voting
rights of the Company have the right to appoint two directors to
the Board (one of whom shall be Dmitry Genkin). It is intended that
Roman Knyazev, a director of SynBio, will join the Board at
Completion.
Beyond its contractual relationships under the terms of the
Co-Development Agreement and the Relationship Agreement, its rights
as a Shareholder, and its minority presence on the Board, SynBio
will have no control or influence over the future business of the
Company, its strategic plans, the deployment of its assets or the
terms of employment of the management or employees of the
Company.
SynBio has no intention of changing the continued employment of
the employees and management of the Company or its subsidiaries,
including any material change in the conditions of their
employment.
The Placing is conditional, inter alia, on the Resolutions, in
particular the Independent Shareholder Resolution, being duly
passed and completion of the Acquisition Agreement. Shareholders'
attention is drawn to the paragraphs below, which set out details
of the City Code and its impact on the Proposals.
Further details on SynBio and the Concert Party, the
Subscription Agreement, the SynBio Warrants and the Co-Development
Agreement will be set out in the Circular.
Information on SymbioTec and the Acquisition
SymbioTec is a company registered in Germany with operations in
Saarbrucken which is principally involved with early stage clinical
trials for its patent-protected lead drug candidate, OncoHist.
OncoHist is a candidate for treatment of AML and ALL, and it has
been granted orphan drug status by both the FDA and the EMA.
SymbioTec's licensee, Cryonix,is currently conducting a Phase
IIb clinical trial in Russia involving up to 120 patients in late
stage relapsed or resistant AML. Subject to satisfactory patient
recruitment, Cryonix hopes to complete these Phase IIb clinical
trials by the end of 2013.
The Company has agreed, conditional, inter alia, on passing of
the Resolutions and completion of the Placing, to acquire by way of
issuance of new shares the entire issued share capital of SymbioTec
in consideration for the issue of the Acquisition Shares, valuing
SymbioTec at GBP8.80 million (based on the Issue Price).
Professor Michael Zeppezauer, the sole director of SymbioTec and
principal scientist behind the development of OncoHist, will join
the Scientific Sub-Committee of the Company following completion of
the Acquisition.
Further details regarding SymbioTec and the Acquisition
Agreement are set out in Part 2 of this announcement and in the
Circular.
Impact of the Acquisition Agreement and the Placing
It is intended that the Placing and the Acquisition will
complete on or before 30 September 2011 and appropriate
announcements as to the completion of the Placing and the
Acquisition will be made, and a letter with formal terms and
condition of the proposed Open Offer will be posted to Qualifying
Shareholders with Application Forms, immediately following
completion of the Placing and Acquisition. The Open Offer will
remain open for acceptances for eleven Business Days following the
date on which the Open Offer is made.
City Code and Concert Parties
Immediately following completion of the Acquisition and the
Placing, SynBio will hold approximately 50.19 per cent. of the
issued share capital of the Company as enlarged by the issue of the
Acquisition Shares and the SynBio Shares.
Whilst completion of the Acquisition and the Placing would
normally give rise to an obligation under Rule 9 of the City Code
for SynBio to make a compulsory offer for the remaining Ordinary
Shares, the Panel has agreed that, subject to the Independent
Shareholder Resolution being passed by the Independent
Shareholders, it will waive the obligation. Further details of the
implications of this are set out in the Circular.
Relationship Agreement
With a view to preserving the independence of the Company from
its largest single shareholder, SynBio (with whom the Directors
anticipate having commercial dealings in the future, as described
above), and the Company's suitability as an AIM company following
completion of the Proposals, the Company and SynBio will
(conditional on completion of the Placing and Acquisition) enter
into the Relationship Agreement pursuant to which SynBio will
ensure that the Company is capable of carrying on its business
independently of it and its associates.
Under the terms of the Relationship Agreement SynBio shall be
entitled to nominate two non-executive Directors, save that the
Directors nominated by SynBio shall not be entitled to request
information, participate in discussions and shall abstain from
voting in relation to any transaction or matter where an actual or
potential conflict of interest exists between SynBio or any
associate and the Company.
The Relationship Agreement shall be immediately terminated if
SynBio and/or any of its associates cease (for a period of more
than six months) to be a Shareholder holding directly or indirectly
over 25 per cent. of the issued ordinary voting capital of the
Company.
Further details of the Relationship Agreement will be set out in
the Circular.
SIIL Master Agreement
The SIIL Master Agreement is both a housekeeping exercise,
consolidating, inter alia, the three existing principal agreements
between the parties into a single over-arching agreement, and the
formalisation of certain commercial terms renegotiated between the
parties in line with achievements made to date and agreed plans for
the future.
The key commercial features of the SIIL Master Agreement are as
follows:
-- The surrender back to the Company of up to 14 product
candidates, the development rights for which were vested in SIIL
under the terms of the existing agreements. The parties have agreed
that the interests of Shareholders will be best served by the
Company regaining full control of such future development
activities both as it expands its internal ability to initiate such
developments and in light of the increasing validation of the
Company's core technologies which is expected to facilitate
partnering opportunities.
-- The issue of the SIIL Consideration Shares to SIIL in
consideration for the beneficial changes in the current
arrangements as outlined above.
-- The uplift in the Company's favour to 75:25 (currently 50:50)
of the economic interest receivable by the Company from
sub-licensing revenue received by the Company in the Lipoxen
Territory (broadly the developed world) in relation to any PSA EPO
product candidate which utilises the Serum EPO cell line.
-- The uplift from 5 per cent. to 8 per cent. of the Company's
share of revenues for, inter alia, non-tender income arising from
sales of SIIL's PSA EPO in all of the SIIL Territories (broadly the
developing world) save for those made in the sovereign territory of
India.
-- Changes to the nature and cost of supply of cGMP PSA
(clinical grade polysialic acid manufactured under conditions of
Good Manufacturing Practice).
-- An additional subscription by SIIL for 2.5 million new
Ordinary Shares at the Issue Price (raising GBP275,000) together
with SIIL Warrants to subscribe for up to 7.5 million Ordinary
Shares over a period of twelve to twenty four months from
completion of the SIIL Master Agreement at an average exercise
price of 20 pence. This represents a potential for up to GBP1.775
million of additional cash proceeds, to further enhance the
Company's ability to accelerate development of its proprietary
pipeline.
-- The issue of the SIIL Consideration Shares is expected to
take place within seven Business Days of completion of the Placing
or by 30 December 2011 at the latest.
The Proposed Open Offer
In order to give Shareholders the opportunity to participate in
this capital raising round at the Issue Price, the Company is
proposing to raise up to approximately GBP1.95 million (before
expenses) through the proposed Open Offer pursuant to which the
Company proposes to offer up to 17,743,225 new Ordinary Shares to
Qualifying Shareholders, such offer to be made immediately upon
completion of the Placing and the Acquisition. Further details of
the Open Offer, proposed timetable and the Application Forms will
be posted to Qualifying Shareholders in due course.
Open Offer
If, and when, an Open Offer is made, it is proposed that
Qualifying Shareholders will be given the opportunity to apply for
the Offer Shares at the Issue Price, pro rata to their holdings of
Existing Shares on the Record Date, on the basis of:
1 Offer Share for every 10 Existing Shares
No member of the Concert Party who is also a Qualifying
Shareholder (namely FDS Pharma and Igor Nikolaev) will participate
in the Open Offer. The Record Date for the Open Offer is 3 August
2011 and the Company's shares have been marked "ex" rights
today.
Effect of the Placing, the Acquisition, the issue of the SIIL
Shares and the proposed Open Offer
Following completion of the Acquisition, the Placing, the issue
of the SIIL Shares and the proposed Open Offer, the New Ordinary
Shares will represent approximately 55.36 per cent. of the
Company's Enlarged Issued Share Capital. The Resolutions must be
passed at the General Meeting in order for the Proposals to
proceed.
The New Ordinary Shares will rank pari passu with the Existing
Shares in all respects including the right to receive all dividends
or other distributions declared, made or paid by the Company after
their respective dates of allotment.
Related Party Transactions
Given that SIIL is a significant shareholder in the Company, and
the significance of the SIIL Master Agreement to the Company, entry
into the SIIL Master Agreement by the Company is a related party
agreement for the purposes of the AIM Rules.
Dmitry Genkin's involvement in the ownership of SymbioTec (where
a company controlled by him is a shareholder), means that the
Acquisition Agreement is a related party agreement for the purposes
of the AIM Rules.
Equally, Dmitry Genkin is also closely involved in the
establishment and ownership of SynBio, the Placing (which includes
the entry into the Subscription Agreement, the Co-Development
Agreement and the Relationship Agreement) therefore falls to be
treated as a related party transaction for the purposes of the AIM
Rules.
Accordingly, in compliance with the AIM Rules, the Independent
Directors have consulted with the Company's nominated adviser,
Singer Capital Markets, in respect of each of the Related Party
Agreements and the Independent Directors consider, having consulted
with Singer Capital Markets, that the terms of the Related Party
Agreements are fair and reasonable insofar as Shareholders are
concerned.
General Meeting
A Circular (to be posted to shareholders today) will contain a
notice convening the General Meeting to be held on 1 September 2011
at 11.00 a.m. at the offices of Pinsent Masons LLP, 30 Crown Place,
London EC2A 4ES, at which the Resolutions will be proposed.
Irrevocable Undertakings
The Directors, Baxter Healthcare SA, Path Property Ltd, FDS
Pharma, SIIL, Poonawalla Investments Limited, the Trustee of the
Lipoxen Joint Share Ownership Plan and Eastern Infotech have
provided irrevocable undertakings in respect of in aggregate
102,890,000 Ordinary Shares representing approximately 57.70 per
cent. of the issued share capital of the Company in which they are
beneficially interested, to vote in favour of all of the
Resolutions (save for FDS Pharma and Igor Nikolaev who will abstain
from voting on the Independent Shareholder Resolution), provided
that the Placing is (i) announced at the Issue Price and (ii)
announced to raise at least GBP12.19 million (before fees and
expenses). The undertakings will lapse upon the passing of the
Resolutions or, if earlier, defeated by a validly conducted poll.
In addition, the undertaking given by Baxter Healthcare SA shall
lapse on (i) the date falling six weeks after the posting of the
Circular to Shareholders; and (ii) in the event that the Circular
has not been posted to Shareholders within five Business Days of
the date of the undertaking, the date falling five business days
after the date of the undertaking.
Recommendation
The Independent Directors, who have been so advised by Singer
Capital Markets, consider the Placing, the Acquisition and the
Panel Waiver to be fair and reasonable and in the best interests of
Independent Shareholders and the Company as a whole. In providing
its advice Singer Capital Markets has relied upon the Directors'
commercial assessments.
The Directors, who have been so advised by Singer Capital
Markets, consider the SIIL Issue, the change of name of the Company
to "Xenetic Biosciences plc" and the adoption of new articles of
association to be fair and reasonable and in the best interests of
the Company's Shareholders.
Accordingly, the Independent Directors unanimously recommend
that Shareholders vote in favour of the Resolutions to be proposed
at the General Meeting, as they have irrevocably undertaken to do
in respect of their own beneficial and connected shareholdings,
which amount in total to 11,264,595 Ordinary Shares representing
approximately 6.35 per cent. of the current issued share capital of
the Company.
Due to the interests of the Concert Party in the matters dealt
with by the Independent Shareholder Resolution, those members of
the Concert Party who are currently Shareholders have undertaken
not to vote on such Independent Shareholder Resolution, though they
have irrevocably undertaken to vote in favour of the remaining
Resolutions in respect of their shareholdings which amount to
41,440,050 Ordinary Shares in aggregate representing approximately
23.36 per cent. of the current issued share capital of the
Company.
Accordingly, the Company has received irrevocable undertakings
to vote in favour of the Independent Shareholder Resolution in
respect of 59,648,181 existing Ordinary Shares in aggregate
representing 43.86 per cent. of the existing enfranchised issued
share capital of the Company and has received irrevocable
undertakings to vote in favour of the remaining Resolutions in
respect of 101,088,231 existing Ordinary Shares, in aggregate
representing 56.97 per cent. of the existing issued share capital
of the Company.
PART 2 - INFORMATION ON SYMBIOTEC
1. Directors
The sole director of SymbioTec is Michael Zeppezauer.
2. Registered Office
The registered office of SymbioTec is Science Park 1, D-66123
Saarbrucken, Germany.
3. Activities
SymbioTec is a small biotechnology company located in
Saarbrucken in southern Germany that has received approximately
EUR14 million of investment to date (a sum similar to that invested
in the Company to date). Its core technology is based around a set
of patents for recombinant human histone H1.3 and recombinant human
N-bis-met-histone H1.3 (active ingredients of OncoHist) for a broad
platform application as a therapeutic to solid and non-solid cancer
tumours. The first two therapeutic treatments being pursued are for
the treatment of acute myeloid leukaemia (AML) and acute
lymphoblastic leukaemia (ALL).
4. Financial Information on SymbioTec
For the financial year ended 31 December 2010, SymbioTec's
annual accounts (unaudited) reported total assets of EUR120,000
(2009: EUR135,000) and net income after tax of EUR(565,000) (2009:
EUR1,190,000).
5. Effect on the Company
The Board considers that the Acquisition of SymbioTec is not
expected to have a material effect on the Company in the context of
the Proposals taken as a whole.
PART 3 - EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Event Time / date (2011)
Record Date for entitlement under the 5.00 p.m. on 3 August
proposed Open Offer
Announcement and publication of the 4 August
Proposals, Circular and Form of Proxy
Ex-entitlement date for the Open Offer 8.00 a.m. on 4 August
Latest time and date for receipt of 11.00 a.m. on 30 August
Forms of Proxy for use at the General
Meeting
General Meeting 11.00 a.m. on 1 September
Completion of the Acquisition and the by 30 September
Placing
Admission of the Acquisition Shares by 8.00 a.m. on 30 September
and the SynBio Shares (commencement
of dealings in the Acquisition Shares
and the SynBio Shares, subject to lock-in
and orderly marketing arrangements)
Notes:
1. All references to time in this Announcement are to London
time (unless otherwise stated).
2. The times and dates set out in the expected timetable of
principal events above and mentioned throughout this
Announcement are indicative only and may be adjusted by the
Company.
3. Different deadlines and procedures for return of Forms of
Proxy may apply in certain cases.
4. Completion of the Acquisition and the Placing are conditional
upon certain events which are to be fulfilled by no later than
30 September 2011 unless otherwise extended with the agreement
of the relevant parties in which event details of the new dates
will, if appropriate, be notified to Shareholders.
PART 4 - DEFINITIONS
The following definitions apply throughout this Announcement
unless the context otherwise requires:
"Announcement" this announcement
"Acquisition" the acquisition by the Company of the entire
issued share capital of SymbioTec
"Acquisition Agreement" the conditional agreement dated 4 August 2011
made between (1) the Company and (2) the
Sellers relating to the Acquisition, further
details of which are set out in the Circular
"Acquisition Shares" the 80,000,000 new Ordinary Shares to be
issued by the Company to the Sellers (or as
they direct) pursuant to the Acquisition
Agreement
"Admission" the admission of the relevant New Ordinary
Shares to trading on AIM becoming effective in
accordance with Rule 6 of the AIM Rules
"AIM" AIM, a market operated by the London Stock
Exchange
"AIM Rules" the AIM Rules for Companies as published by
the London Stock Exchange from time to time
"ALL" acute lymphoblastic leukaemia
"AML" acute myeloid leukaemia
"Application Form" the form of application to be posted to
Shareholders in due course by which
applications are to be made under the proposed
Open Offer
"Board" or "Directors" the directors of the Company
"Business Day" any day (except Saturdays and Sundays) on
which banks are open in London for the
transaction of normal banking business
"City Code" The City Code on Takeovers and Mergers
"Co-Development the agreement between (1) the Company and (2)
Agreement" SynBio, further details of which are set out
in the Circular
"Company" Lipoxen plc, a company registered in England
and Wales with registered number 03213174
"Completion" the Placing being effected immediately
following completion of the Acquisition in
accordance with the Acquisition Agreement
"Concert Party" each of SynBio, Dmitry Dmitrievich Genkin,
Artur Aleksandrovich Isaev, OJSC Institute of
Human Stem Cells ("HSCI"), OJSC Rusnano
("Rusnano"), FDS Pharma, Pharmsynthez, JSC
Cryonix, Angport Limited, OOO Baltic Finance
and Igor Nikolaev, as more particularly
described in the Circular
"Circular the document to be despatched to Shareholders
containing details of the Proposals and
convening the General Meeting
"EMA" the European Medicines Agency
"Enlarged Issued the Ordinary Shares in issue immediately
Share Capital" following Admission of the Acquisition Shares,
the SynBio Shares, the SIIL Shares and the
Offer Shares, assuming that the Open Offer is
taken up in full
"Existing Shares" the 177,432,255 Ordinary Shares currently in
issue at the date of this Announcement which
are admitted to trading on AIM
"FDA" The Food and Drug Administration of the USA
"FDS Pharma" FDS Pharma Associates LP, an English
registered limited partnership
"First Closing" completion of the Acquisition and the Placing
"Form of Proxy" the form of proxy for use in connection with
the General Meeting which accompanies the
Circular
"FSMA" the Financial Services and Markets Act 2000,
as amended from time to time
"General Meeting" the general meeting of the Company, to be
convened at 11.00 a.m. on 1 September 2011,
and any adjournment thereof, notice of which
is set out at the end of the Circular
"Group" the Company, its subsidiaries and its
subsidiary undertakings
"Independent Directors" Sir Brian Richards, M. Scott Maguire, Colin
Hill and Professor Gregory Gregoriadis (and
"Independent Director" shall mean any one of
them)
"Independent Shareholders" Shareholders other than the Concert Party
"Independent Shareholder resolution 1 set out in the Notice of General
Resolution" Meeting being an ordinary resolution, to be
taken on a poll of Independent Shareholders,
to approve the Panel Waiver
"Issue Price" 11 pence per new Ordinary Share
"London Stock London Stock Exchange plc
Exchange"
"New Ordinary the Acquisition Shares, the SynBio Shares, the
Shares" SIIL Shares and the Offer Shares
"Notice of General the notice convening the General Meeting
Meeting" contained in the Circular
"Offer Shares" up to 17,743,225 new Ordinary Shares to be
offered pursuant to the Open Offer
"Open Offer" the open offer intended to be made to
Qualifying Shareholders which, if made, shall
constitute an invitation to apply for Offer
Shares on the terms and subject to the
conditions that will be communicated
separately to Shareholders in due course
"Ordinary Shares" ordinary shares of 0.5 pence each in the
capital of the Company
"Overseas Shareholders" Shareholders with registered addresses outside
the UK or who are citizens or residents of, or
located in, countries outside the UK
"Panel" or "Takeover the Panel on Takeovers and Mergers
Panel"
"Panel Waiver" the waiver (further details of which are set
out in the Circular) granted by the Panel,
subject to the passing of the Independent
Shareholder Resolution on a poll of
Independent Shareholders at the General
Meeting, of the obligation of SynBio which
would otherwise arise under Rule 9 of the City
Code to make a mandatory offer for the
Ordinary Shares not already owned by the
Concert Party as a result of the Placing and
the Acquisition
"Placing" the issue of the SynBio Shares pursuant to the
Subscription Agreement
"Proposals" together the Acquisition, the Placing, the
SIIL Issue, the proposed change of the name of
the Company to "Xenetic Biosciences plc" and
the proposed adoption of new articles of
association by the Company
"Qualifying Shareholders" Shareholders on the register of members of the
Company at the Record Date as holders of
Existing Shares with the exclusion (subject to
certain exceptions) of persons with a
registered address or located or resident in
the United States, Australia, Canada, Japan,
New Zealand and the Republic of South Africa
"Record Date" 5.00 p.m. on 3 August 2011
"Registrar" Share Registrars Limited of Suite E, First
Floor, 9 Lion and Lamb Yard, Farnham, Surrey
GU9 7LL
"Related Party the Acquisition Agreement, the Subscription
Agreements" Agreement, the Co-Development Agreement and
the Relationship Agreement
"Relationship the agreement to be entered into between (1)
Agreement" the Company and (2) SynBio, further details of
which are set out in the Circular
"Resolutions" the resolutions set out in the Notice of
General Meeting contained in the Circular
"Shareholders" holders of Ordinary Shares from time to time
"Second Closing" the issue of the SIIL Shares pursuant to the
SIIL Master Agreement
"Sellers" HSCI; Angport Limited; Professor Michael
Zeppezauer; Dr Volker Rusch and Klaus Faber
AG
"Serum Institute The Serum Institute of India Limited, a
of India" or "SIIL" company incorporated under the laws of India
having its principal place of business at
S.No. 212/2, Off Sol; Poonawalla Road,
Hadapsar, Pune-411 028, Maharashtra, India
"SIIL Consideration the 9,000,000 Ordinary Shares to be issued to
Shares" the Serum Institute of India in consideration
for, inter alia, the surrender of certain
development rights back to the Company
pursuant to the SIIL Master Agreement
"SIIL Issue" the issue of the SIIL Shares pursuant to the
SIIL Master Agreement
"SIIL Master Agreement" the master agreement made on 4 August 2011
between (1) the Company and (2) the Serum
Institute of India, further details of which
are set out in the Circular
"SIIL Shares" the SIIL Consideration Shares and the SIIL
Subscription Shares
"SIIL Subscription the 2,500,000 Ordinary Shares to be allotted and
Shares" issued to SIIL for cash pursuant to the SIIL
Master Agreement
"SIIL Warrant the warrant instrument made on 4 August 2011 by
Instrument" the Company pursuant to which the SIIL Warrants
are constituted
"SIIL Warrants" the warrants to be issued to SIIL pursuant to
the terms of the SIIL Warrant Instrument,
further details of which are set out in the
Circular
"SynBio" SynBio LLC, a limited liability company
incorporated under the laws of the Russian
Federation, Main State Registration Number
1117746126321, having its registered office at
building 2, 55/1, Leninsky Prospekt, Moscow,
Russian Federation
"SynBio Shares" the 110,800,000 Ordinary Shares to be issued
to SynBio pursuant to the Subscription
Agreement subject to the passing of the
Resolutions
"SynBio Warrant the warrant instrument made on 4 August 2011
Instrument" by the Company pursuant to which, subject to
the passing of the Resolutions, the SynBio
Warrants are constituted
"SynBio Warrants" the warrants issued to SynBio pursuant to the
terms of the SynBio Warrant Instrument,
further details of which are set out in the
Circular
"Singer Capital Singer Capital Markets Limited, the Company's
Markets" or "SCM" nominated adviser and broker
"Subscription the conditional agreement made on 4 August
Agreement" 2011 between (1) the Company and (2) SynBio,
further details of which are set out in the
Circular
"SymbioTec" SymbioTec GmbH, a company incorporated under
the laws of Germany further details of which
are set out in Part 2 of this Announcement and
in the Circular
"Third Closing" Completion of the proposed Open Offer,
assuming that it is taken up in full
"UK" or "United the United Kingdom of Great Britain and
Kingdom" Northern Ireland
"US" or "United the United States of America, its territories
States" and possessions, any state of the United
States of America and the District of
Columbia
References in this Announcement to "$"" are US dollars being the
legal tender of the United States, references to "EUR" are to Euros
and references to "Rubles" are to the legal tender of Russia.
Unless otherwise stated the Sterling exchange rates applied
throughout this Announcement are as follows:
GBP1.00 = EUR1.20
GBP1.00 = $1.60
GBP1.00 = Ruble 49.50
All references in this Announcement to times are, unless
otherwise expressly provided, references to the time in London,
UK.
Notes to Editors
About Lipoxen
Lipoxen plc is a biopharmaceutical company focused on the
development of new and improved biologic drugs and vaccines.
Lipoxen has three proprietary patented technology platforms:
1) PolyXen - for extending the efficacy and half life of
biologic drugs
2) ImuXen - for creating new vaccines and improving existing
vaccines
3) SiRNAblate - for the delivery of siRNA
Lipoxen's technology is designed to improve the efficacy,
safety, stability, biological half-life and immunologic
characteristics of its products.
Lipoxen has multiple drug and vaccine programmes in development.
Two products are in clinical development, SuliXen, a long acting
insulin and ErepoXen, a long-acting erythropoietin (EPO). Lipoxen's
preclinical pipeline includes vaccines against HIV, multiple
sclerosis and influenza and an exclusive license deal with Baxter
Healthcare for blood coagulation drugs.
The Company has a low-risk business model and out-licenses its
proprietary technologies to biopharmaceutical companies that have
strong manufacturing and marketing capabilities. Lipoxen currently
has commercial agreements with some of the world's leading
biotechnology and pharmaceutical companies including Baxter,
Schering-Plough, the Serum Institute of India Limited, Genentech,
and Genzyme. Furthermore, Baxter, the Company's third largest
shareholder, and management led the GBP2.9 million fundraising that
the Company announced in May 2009. This fundraising was followed up
by a GBP1.2 million placing in April 2010 which was led by the
Company's management team.
Lipoxen, which was founded in 1997, trades on the AIM Market of
the London Stock Exchange under the ticker symbol LPX. More
information can be found at the Company's website:
www.lipoxen.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCUSSVRASAWRRR
Lipoxen (LSE:LPX)
Historical Stock Chart
From Apr 2024 to May 2024
Lipoxen (LSE:LPX)
Historical Stock Chart
From May 2023 to May 2024
