Advanced Oncotherapy - Update on Financing and Current Financial Position

Advanced Oncotherapy

23/10/2023 07:00

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RNS Number : 8855Q  Advanced Oncotherapy PLC  23 October 2023

Prior to publication, the information contained within this announcement was
deemed by the Company to constitute inside information for the purposes of
Regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310.
With the publication of this announcement, this information is now considered
to be in the public domain.

 

23 October 2023

ADVANCED ONCOTHERAPY PLC

("Advanced Oncotherapy", "AVO" or the "Company")

 

Update on Financing Discussions and Current Financial Position

 

On 17 July 2023 Advanced Oncotherapy (AIM: AVO), the developer of
next-generation proton therapy systems for cancer treatment, announced that it
was exploring a recapitalisation plan aimed at providing a longer-term funding
solution to support the commercial development of the LIGHT technology in a
capital-intensive industry. Further to this announcement, and the subsequent
announcement issued on 29 September 2023, the Company provides the following
update in relation to its financing discussions and current financial
position.

 

The Company has recently signed a non-binding term sheet with a third-party
(the "Investor"). Under this envisaged transaction (the "Financing
Transaction"), the Investor is expected to provide funding of up to c.$80
million which is intended to meet the Company's cashflow requirements through
to the European certification of the LIGHT System. The treatment of first
patients with LIGHT is now targeted for 2024 with certification of the LIGHT
System to follow thereafter. The form and terms of this Financing Transaction
will be subject to agreement on definitive documentation, satisfaction of
conditions precedent and the obtaining of all requisite approvals and
consents. It is anticipated the Financing Transaction will be a mixture of
equity and debt financing. Discussions are progressing and further
announcements on the Financing Transaction will be made at the appropriate
time.

 

As previously announced the Company has been working on bridge financing to
alleviate the Company's immediate financing needs. Discussions on bridge
financing are ongoing and as part of these arrangements, the Company has
raised £200,000 via a short-term four-month unsecured loan agreement with a
new investor which carries interest at a rate of 1.25% p.m. In addition, the
Company has raised £150,000 from an existing investor under its secured
convertible loan note agreement. The terms are the same as those that were
first announced on 1 March 2023. The Company continues to carefully manage its
creditors whilst it aims to finalise the Financing Transaction.

 

As of 19 October 2023 the Company held cash of approximately £200,000. The
current liabilities of the Company include £22 million owed to trade and
other unsecured creditors and £39 million of financial debt. If the Financing
Transaction proceeds, it is expected that a significant portion of current
liabilities and financial debt will be converted into equity.

 

Whilst the board of the Company is hopeful of a satisfactory outcome, there
can be no certainty that the Financing Transaction will proceed. Without
access to the additional capital which is proposed to be provided by the
Investor, the Company is unlikely to be able to continue to trade and would
very likely become insolvent and be placed into administration.

 

Update on Formal Sale Process

 

The Company announced on 18 April 2023 the commencement of a strategic review
and formal sale process under the Takeover Code (the "Formal Sale Process").
Whilst the Financing Transaction has been the Company's primary focus, the
Company remains in discussions under the Formal Sale Process with strategic
players in the radiotherapy sector. There can be no certainty that any offer
will be made for the Company, or even proposed, or as to the terms of any
proposal or offer that may be made.

 

Other implications of the Takeover Code

 

Under Rule 21 of the Takeover Code, whilst the Company remains in receipt of
an approach from or in discussions with potential offerors, as defined in the
Takeover Code, certain elements of the Financing Transaction may constitute
frustrating action under Rule 21 of the Takeover Code. Accordingly, should
this still be relevant, the Company will seek either consent from any
potential offeror or will seek the approval of shareholders at a General
Meeting to implement such elements of the Financing Transaction.

 

In addition, as set out in the announcement of 17 July 2023, the
implementation of certain aspects of the Financing Transaction might require
the granting by the Panel on Takeovers and Mergers of a waiver of certain
obligations under Rule 9 of the Takeover Code and the approval of independent
shareholders of the Company at a general meeting of such a waiver.

 

 

 Advanced Oncotherapy Plc                                       www.avoplc.com (http://www.avoplc.com)
 Dr. Michael Sinclair, Executive Chairman                       Tel: +44 (0) 20 3617 8728
 Nicolas Serandour, CEO

 WH Ireland Limited (Financial adviser)                         Tel: +44 (0) 20 7220 1666
 Antonio Bossi / James Bavister                                 AVOPLC@whirelandcm.com

 Allenby Capital Limited (Nomad and Joint Broker)
 Nick Athanas / Piers Shimwell (Corporate Finance)              Tel: +44 (0) 20 3328 5656

 Amrit Nahal / Matt Butlin (Sales & Corporate Broking)

 SI Capital Ltd (Joint Broker)
 Nick Emerson                                                   Tel: +44 (0) 1483 413 500
 Jon Levinson                                                   Tel: +44 (0) 20 3871 4066

About Advanced Oncotherapy Plc www.avoplc.com

 

Advanced Oncotherapy Plc, a UK headquartered company with offices
in London, Geneva, The Netherlands and in the USA, is a provider of
particle therapy with protons that harnesses the best in modern
technology. Advanced Oncotherapy's team "ADAM," based in Geneva, focuses on
the development of a proprietary proton accelerator called, Linac Image Guided
Hadron Technology (LIGHT). LIGHT's compact configuration delivers proton beams
in a way that facilitates greater precision and electronic control.

 

Advanced Oncotherapy Plc will offer healthcare providers affordable systems
that will enable them to treat cancer with innovative technology as well as
expected lower treatment-related side effects.

 

Advanced Oncotherapy Plc continually monitors the market for any emerging
improvements in delivering proton therapy and actively seeks working
relationships with providers of these innovative technologies. Through these
relationships, the Company will remain the prime provider of an innovative and
cost-effective system for particle therapy with protons.

 

 

 

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