REG - Craven House Capital - Investee company update: Bio Vitos

Craven House CapitalAnnouncement

08/02/2023 07:00

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RNS Number : 2316P  Craven House Capital PLC  08 February 2023

8 February 2023

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF REGULATION
(EU) 596/2014 AS IT FORMS PART OF DOMESTIC LAW IN THE UNITED KINGDOM BY VIRTUE
OF THE EU (WITHDRAWAL) ACT 2018.

Craven House Capital plc

("Craven House" or the "Company")

Investee company update: Bio Vitos

The Board of Craven House notes the announcement released earlier today by
Hemcheck Sweden AB ("Hemcheck") and is pleased to announce that its 24.5%
owned investee company Bio Vitos has today entered into an agreement with
Hemcheck, a company listed on the Nasdaq Stockholm (the "Agreement").  As
part of the Agreement and subject to approval by Hemcheck's shareholders at an
EGM to be convened at a date still to be confirmed, Hemcheck will create a new
subsidiary ("NewCo") and transfer all current business and assets of Hemcheck
to this new subsidiary. Under the terms of the Agreement, Bio Vitos has agreed
to provide Hemcheck with  SEK1.23 million in cash, within 14 days after the
approval of the transaction by Hemcheck's shareholders.

Bio Vitos will then pay a further SEK4 million in cash, to Hemcheck, within
thirty days following the distribution of shares in NewCo to Hemcheck
shareholders.

In addition Bio Vitos has agreed to provide Hemcheck with its IP rights
(patents or patent applications) in respect of  an active substance Iron
Succinate (Succifer and used in a marketed product Inofer). In exchange, Bio
Vitos will receive 259,654,000 shares in Hemcheck, amounting to circa 88.3% of
Hemcheck's share capital.

Craven House's holding in Bio Vitos will remain unchanged.

The Board of Craven House is informed by Bio Vitos that under the rules of the
Nasdaq Stockholm this is deemed to constitute a reverse takeover for Hemcheck.
It is anticipated that subject to all required shareholder and regulatory
approvals, that Hemcheck will remain listed on the Nasdaq Stockholm.

The full text of the announcement released by Hemcheck today has been
translated and set out below:

"PRESS RELEASE

 

Hemcheck enters into a conditional agreement with Bio Vitos Medical Limited
regarding the acquisition of IP rights and capital as well as distribution of
operations.

Since the summer of 2022, Hemcheck's board has been working intensively on
finding various structural alternatives for the company, including a solution
to the company's future financing. The proposal that will now be submitted to
an extraordinary general meeting involves the acquisition of capital and IP
rights by Bio Vitos Medical Limited ("Bio Vitos") through a new issue of
shares in Hemcheck as well as distribution of current operations to the
shareholders for further application for relisting, alternatively divestment.

In short, the transaction means, if approved by Hemcheck's shareholders, that

•    Bio Vitos pays Hemcheck a fee of SEK 1.23 million to cover
transaction costs

 

•    Hemcheck's current operations are transferred to a wholly owned
subsidiary ("Subsidiary") which is distributed to current shareholders
("Distribution"). The distribution is deemed to be possible with application
of the so-called Lex ASEA rule.

 

•    Hemcheck acquires IP rights regarding the use of iron succinate for
the treatment of patients diagnosed with heart failure with reduced ejection
fraction (HFrEF) for China, the USA, Japan and the EU excluding Sweden,
Denmark, Norway and Finland. Furthermore, Hemcheck receives a capital
injection of SEK 4 million.

 

•    As consideration for the IP rights and the capital of SEK 4 million,
a directed new issue of 259,654,000 new shares is given to Bio Vitos,
corresponding to a dilution of approx. 88.3%. The newly issued shares must in
turn be distributed to Bio Vito's shareholders.

 

Hemcheck's purpose of the transaction

Hemcheck's board has evaluated all possible scenarios to ensure the continued
operation of the company. In December, decisions were made on radical cost
reductions to enable more time to implement a structural deal. In order to
avoid that a delisting needs to be done and at the same time continue to
enable a structural deal regarding current operations, the Transaction is
judged by Hemcheck's board to be the best option going forward for Hemcheck
and its shareholders.

 

Distribution of the Subsidiary

Hemcheck's previous operations will continue to be conducted in the
Subsidiary. The rest of Hemcheck's assets and liabilities will therefore be
transferred to the Subsidiary before the Transaction is completed. Hemcheck
will then distribute all shares in the Subsidiary to its current shareholders.
The distribution is deemed to be possible with application of the so-called
The Lex ASEA rule, which means that the Dividend does not cause any immediate
taxation for the shareholders. Instead, the acquisition value is divided
between the share in Hemcheck and the share in the Subsidiary. The dividend
will be proposed to be approved by the general meeting of Hemcheck.

The subsidiary will continue its operations and continue to try to implement a
structural deal. After the Transaction has been completed, if no structural
deal has been agreed, the subsidiary will apply for listing on a regulated
market or trading platform and will draw up a company description within the
framework of this listing process. Such application for listing requires the
approval of the marketplace.

 

Extraordinary general meeting

Hemcheck intends to call an extra general meeting for decisions on the matters
concerning the Transaction described now. This includes changes to amendments
to the articles of association, decisions on new issue, distribution of the
Subsidiary, etc.

 

Preliminary timetable

Within 30 working days, Hemcheck intends to call an extraordinary general
meeting for a decision on the Transaction. Due to a change in the articles of
association, the notice period amounts to at least four weeks, meaning that
the meeting can be held no earlier than four weeks after publication of the
notice. Provided that the general meeting takes the decisions required to
implement the Transaction, it is estimated that the entire Transaction can be
completed approximately one month after the general meeting. The record date
for the distribution of all shares in the Subsidiary will fall in such a way
that the shares issued to Bio Vitos do not entitle to the Distribution. After
the meeting, all decisions are notified for registration with the Swedish
Companies Registration Office.

 

Information about the IP rights

Bio Vitos holds IP rights regarding the use of iron succinate for the
treatment of patients diagnosed with heart failure with reduced ejection
fraction (HFrEF) for China, the USA, Japan and the EU excluding Sweden,
Denmark, Norway and Finland. These are in turn acquired by Double Bond
Pharmaceutical, which is a listed company on the Spotlight stock market.

 

For further information, contact:

Hemcheck Sweden AB (publ)

Joen Averstad, CEO

Phone: +46 (0) 76 108 8191

Email: joen.averstad@hemcheck.com"

 

 

 

(Link to press release:
https://hemcheck.se/pressmeddelanden/hemcheck-ingar-villkorat-avtal-med-bio-vitos-medical-limited-om-anskaffning-av-ip-rattigheter-och-kapital-samt-utdelning-av-verksamhet/)

 

For further information please contact:

 Craven House Capital Plc                                                Tel: 0203 286 8130

 Mark Pajak

 www.Cravenhousecapital.com (http://www.cravenhousecapital.com/)

 SI Capital                                                              Tel: 01483 413500

 Broker

 Nick Emerson

 www.sicapital.co.uk (http://www.sicapital.co.uk/)

 SPARK Advisory Partners Limited                                         Tel: 0203 368 3550

 Nominated Adviser

 Matt Davis/James Keeshan

 www.Sparkadvisorypartners.com (http://www.sparkadvisorypartners.com/)

 

About Craven House Capital:

The Company's Investing Policy is primarily to invest in or acquire a
portfolio of companies, partnerships, joint ventures, businesses or other
assets participating in the e-Commerce sector.

 

 

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