REG - Shield Therapeutics - Subscription by AOP Health to raise US$10 million
06/12/2024 11:30
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RNS Number : 1764P Shield Therapeutics PLC 06 December 2024
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 (as it forms part of domestic law in the United Kingdom by
virtue of the European Union (Withdrawal) Act 2018). Upon the publication of
this announcement via the Regulatory Information Service, this inside
information is now considered to be in the public domain.
Shield Therapeutics plc
("Shield", the "Group" or the "Company")
Subscription by AOP Health International Management AG of 256,410,256 Ordinary
Shares at 3.0p per share to raise US$10 million
RetailBook Offer of up to 33,333,333 Ordinary Shares to raise up to £1.0
million
Proposed waiver of obligations under Rule 9 of the Takeover Code
and
Notice of General Meeting
London, UK, 6 December 2024: Shield Therapeutics plc (LSE: STX), a commercial
stage pharmaceutical company specialising in iron deficiency, today announces,
further to the announcements on 29 October 2024 and 21 November 2024, a
subscription by AOP for Ordinary Shares at a subscription price of 3.0 pence
per Ordinary Share (the "Subscription Price") to raise aggregate gross
proceeds of $10 million (the "Subscription"). The Company entered into a
subscription agreement with AOP on 6 December 2024 pursuant to which AOP
conditionally agreed to subscribe for 256,410,256 new Ordinary Shares at the
Subscription Price (the "Subscription Agreement").
Separately, and conditional on completion of the Subscription, the Company is
undertaking an intermediaries offer via RetailBook of up to 33,333,333 new
Ordinary Shares at the Issue Price to existing retail shareholders of the
Company (the "RetailBook Offer").
AOP has stated to the Company that it is not prepared to proceed with an
equity investment in the Company unless it obtains a controlling interest
(i.e. greater than 50% of the Enlarged Share Capital) as a result. Such a
Subscription is conditional upon the approval of the Resolutions by the
Shareholders at the General Meeting (including the Waiver Resolution) and the
Subscription Admission. If such approvals are not provided, AOP will not be
required to proceed with an equity investment in the Company resulting in the
Company not receiving the aggregate gross proceeds of at least $10 million,
which would otherwise have helped the Company achieve its aim of becoming cash
flow positive by the end of the calendar year of 2025.
AOP (excluding its concert parties) currently holds 311,597,265 Ordinary
Shares, representing 39.84 per cent. of the Company's issued share capital.
The AOP Directors and persons acting in concert with AOP currently hold, in
aggregate, 327,873,978 Ordinary Shares, representing 41.93 per cent. of the
Company's issued share capital. In the event that the maximum number of
RetailBook Offer Shares are issued, following the completion of the
Subscription, AOP (excluding its concert parties) will hold 568,007,521
Ordinary Shares, representing 53.00 per cent. of the Enlarged Share Capital,
and AOP, the AOP Directors and its concert parties will hold 584,284,234
Ordinary Shares in aggregate, representing 54.51 per cent. of the Enlarged
Share Capital. In the event no RetailBook Offer Shares are issued, following
the Subscription, AOP (excluding its concert parties) would hold 568,007,521
Ordinary Shares, representing approximately 54.70 per cent. of the Enlarged
Share Capital, and AOP, the AOP Directors and persons acting in concert with
AOP would hold 584,284,234 Ordinary Shares, representing approximately 56.26
per cent. of the Enlarged Share Capital.
The proposed Subscription gives rise to certain considerations under the
Takeover Code.
Under Rule 9 of the Takeover Code, when any person who, together with persons
acting in concert with that person, is interested in shares which in the
aggregate carry not less than 30 per cent. of the voting rights of a company,
but does not hold shares carrying more than 50 per cent. of such voting
rights, and such person, or any person acting in concert with that person,
acquires an interest in any other shares which increases the percentage of the
shares carrying voting rights in which that person is interested, then, that
person is normally required to extend offers in cash for all the remaining
equity share capital of the company (a "Mandatory Offer").
AOP has confirmed that it is not prepared to make a Mandatory Offer for the
Company. The Panel has agreed to grant the Panel Waiver on condition that the
Waiver Resolution is passed by the Independent Shareholders at the General
Meeting on a poll vote. The Subscription is conditional upon the Waiver
Resolution being passed.
In accordance with the provisions of the Takeover Code, AOP and each member of
its concert party is considered to be interested in the outcome of the Waiver
Resolution and, accordingly, each of them will not vote on the Waiver
Resolution. Dr Christian Schweiger and Dr Rudolf Widmann have not taken part
in any decision of the Independent Directors relating to the Panel Waiver.
The Directors do not have sufficient authorities to allot the Subscription
Shares to AOP pursuant to the Subscription. Accordingly, the Subscription is
also conditional upon the Directors obtaining appropriate Shareholder
authorities at the General Meeting to allot the Subscription Shares to AOP and
to disapply statutory pre-emption rights which would otherwise apply to such
allotment.
The issue of the RetailBook Offer Shares will be conditional upon completion
of the Subscription and will be undertaken pursuant to the authorities granted
to the Directors at the Company’s Annual General Meeting held on 20 June
2024.
Subject to the Resolutions being passed at the General Meeting, it is expected
that the Subscription Shares and the Issued RetailBook Offer Shares will be
admitted to trading on AIM at 8.00 a.m. on 30 December 2024. Further details
regarding the Subscription and the RetailBook Offer are set out at paragraphs
4 and 8 below.
A circular, including notice of the General Meeting, is expected to be sent to
Shareholders and be made available on the Company's website
at https://www.shieldtherapeutics.com/ (https://www.shieldtherapeutics.com/)
on or around 6 December 2024 (the “Circular”). This announcement and the
Circular explain the background to the Subscription and the RetailBook Offer,
to set out the reasons why the Independent Directors believe that the
Subscription and the Panel Waiver are in the best interests of the Company and
its Shareholders as a whole, and to seek Shareholder approval of the
Resolutions at the General Meeting, which will be held at Northern Design
Centre, Baltic Business Quarter, Gateshead Quays, Newcastle NE8 3DF at 09:30
am on 24 December 2024.
IMPORTANT NOTICE
The Company has called the General Meeting in order to put to Shareholders the
Resolutions required to approve the Panel Waiver and to complete the
Subscription.
If the Resolutions are not approved by Shareholders at the General Meeting, no
Ordinary Shares will be issued to AOP pursuant to the Subscription or to
retail investors pursuant to the RetailBook Offer, and neither the
Subscription nor RetailBook Offer will proceed. As such, the anticipated net
proceeds of the Subscription and the RetailBook Offer would not be received by
the Company. Alternative funding may not be available to Shield on suitable
terms or at all, as expanded on below.
The Company’s ability to raise additional debt financing is limited by an
existing $20 million secured debt financing facility with SWK, as well as a
recently expanded $15 million factoring arrangement between Shield US and
Sallyport. In addition, in July 2024 the Company entered into a $5.7 million
milestone monetization agreement with AOP to raise additional capital to
support the Company’s growth. The Company has therefore continued to source
significant capital in addition to a number of equity raises completed since
2021 to finance anticipated growth in the US. It has recently become clear to
the Board that additional capital is needed to help the Company achieve its
aim of becoming cash flow positive by the end of the calendar year of 2025. If
the Company was not able to obtain additional funding, the Independent
Directors believe the Group would only have sufficient working capital to
trade through to approximately Q2 of 2025. Shield’s rate of cash burn, and
its ability to meet the covenants under the SWK facility, remain highly
dependent on the rate of sales growth for ACCRUFeR®.
2. Background to and reasons for the Subscription
The Company confirmed its intention to self-commercialise ACCRUFeR® in the US
in 2020 and since that time it has made significant progress towards creating
a successful commercial entity in the US, which is a key market globally for
pharmaceutical companies. Supporting this commercial strategy has required
significant capital, and the Company has raised over £50 million in equity
since early 2021 and has also sought additional types of capital at various
times including a convertible loan from AOP, $20 million of debt funding from
SWK, a $15 million factoring arrangement between Shield US and Sallyport and,
more recently, $5.7 million from a milestone monetization agreement with AOP.
This capital has enabled the Company to materially grow its revenues from the
sale of ACCRUFeR® in the US, with Q3 2024 revenues being $7.2million compared
to $1.2 million in Q1 2023. Total Group revenues in the nine-month period to
30 September 2024 equated to $20 million, of which around $18.2 million were
earned in the US.
For some time, the Board has been focused on the Group becoming cash flow
positive by the end of the calendar year of 2025. As announced by the
Company on 29 October 2024, following analysis of the Q3 2024 ACCRUFeR®
performance and assessing the consequential impact on its internal
projections, the Board concluded that additional capital would be required and
also confirmed that measures to lower the Group’s operating cost base would
be taken to help the Company achieve its goal of becoming cash flow positive
by the end of 2025. At the same time, Shield US agreed an expansion of its
working capital financing with Sallyport from $10 million to $15 million and
confirmed that, based on the Company's internal estimates at the time, the
Group had a cash runway into Q2 2025. The Company's largest shareholder, AOP,
executed a non-binding term sheet at the same time to subscribe for new
Ordinary Shares at a subscription price of 4.0 pence per Ordinary Share, which
would raise aggregate gross proceeds of at least $10 million. The 4.0 pence
price represented a 5.3% premium to the closing middle market price of an
Ordinary Share on 28 October 2024. Based on the Company's internal estimates,
the Subscription would help the Company achieve its aim of becoming cash flow
positive by the end of the calendar year of 2025. The Company's rate of cash
burn and anticipated cash runway are highly dependent on sales growth for
ACCRUFeR® achieving the Company’s internal forecasts.
Following the announcement on 29 October 2024, the Company’s share price has
declined and on the Disclosure Date, the closing middle market price of an
Ordinary Share was 2.85 pence. AOP and the Company have therefore agreed to a
subscription price of 3.0p per Subscription Share with AOP, representing a 5.3
per cent. premium to the closing middle market price on the Disclosure Date.
The gross proceeds of the Subscription will remain at $10,000,000.
Prior to the announcement on 29 October 2024, the Company had assessed a
limited range of options to raise additional capital, however, no feasible
such options were identified. As detailed above, the Company’s ability to
raise additional debt financing is limited by its existing $20 million secured
debt financing facility with SWK, as well as a recently expanded $15 million
factoring arrangement between Shield US and Sallyport. In addition, in July
2024 Shield entered into a $5.7 million milestone monetization agreement with
AOP to raise additional capital to support the Company’s growth. Finally,
market conditions for small cash burning companies quoted on AIM remain
challenging and, accordingly, the Company and its brokers have not been able
to source additional equity capital on terms more favourable than those being
proposed by AOP in connection with the Subscription.
The Board continues to see a significant opportunity for the generation of
Shareholder value in the future and the Subscription is intended to provide
the Company with the additional capital needed to help the Company achieve its
aim of becoming cash flow positive by the end of 2025.
The Board notes AOP's statement that AOP does not have any intention of
changing the composition of the Board before the Company's 2026 Annual General
Meeting. However, depending upon the progress made with commercialising
ACCRUFeR®/Feraccru® and the Company's financial situation, AOP may decide to
exercise its right to do so over the next 12 to 18 months.
3. Information on the Company
The Company is a commercial stage pharmaceutical company specialising in iron
deficiency. The Company is focused on the commercialization of
ACCRUFeR®/Feraccru® (ferric maltol), a novel oral iron therapy
differentiated from other conventional irons by its efficacy, well-tolerated
formulation.
The Company launched ACCRUFeR® in the US in May 2023 following the entry into
an exclusive, multi-year collaboration agreement with Viatris, Inc. signed in
December 2022. Feraccru® is commercialised in the UK and European Union by
Norgine B.V., who also have the marketing rights in Australia and New Zealand.
The Company also has an exclusive license agreement with Beijing Aosaikang
Pharmaceutical Co., Ltd., for the development and commercialization of
ACCRUFeR® / Feraccru® in China, Hong Kong, Macau and Taiwan, with Korea
Pharma Co., Ltd. for the Republic of Korea, and with KYE Pharmaceuticals Inc.
for Canada.
On 4 September 2024, the Company announced its unaudited interim results for
the six months ended 30 June 2024 and provided a business update covering its
activities in H1 2024. On 29 October 2024, the Company published an unaudited
trading update relating to its activities in Q3 2024, in which it reported:
1. Total ACCRUFeR® net sales of $7.2 million, representing 4% growth compared to
$6.9 million in Q2 2024 and 76% growth compared to Q3 2023;
2. The growth rate difference between revenues and prescription demand
were due to the impact of wholesalers buying ahead of the July 4 weekend
during the last week of June 2024;
3. Total prescriptions of approximately 43,500, an increase of 20% over Q2
2024 and an 86% increase over Q3 2023;
4. An average net selling price of $167 per prescription vs. $171 in Q2
2024 and $148 in Q3 2023. Excluding July, the average net selling price in Q3
2024 was $192 per prescription;
5. Total Group revenues of $8.0 million including royalties and milestones
from global partners for Q3 2024, resulting in $20.0 million of revenue for
the 9 months ended 30 September 2024; and
6. Cash and cash equivalents of $7.7 million as compared to $8.1 million
as at 30 June 2024.Error! Bookmark not defined.
The Board confirmed at that time that its internal estimates indicated that
trading remains in line with market expectations for 2024 and the Company is
expected to meet the total revenue covenant target of $31.5 million for the
full year 2024 under the debt facility agreement with SWK.
On 21 November 2024, Shield announced a business update in which it reported:
1. Recruitment has recently been completed of adult patients in the Phase 3
confirmatory study in China, being the final study required to support the
filing of an NDA in China for the commercialisation of Feraccru®/Accrufer®;
and
2. Strong sales of ACCRUFeR® in October 2024 were driven primarily by an
increase net selling price to more than $225 per prescription.
4. Subscription
The Company and AOP entered into the Subscription Agreement on 6
December 2024 pursuant to which AOP conditionally agreed to subscribe for
256,410,256 Ordinary Shares at the Issue Price, raising aggregate proceeds of
$10 million. In the event that the maximum number of RetailBook Offer Shares
are issued, following the completion of the Subscription, AOP (excluding its
concert parties) will hold 568,007,521 Ordinary Shares, representing 53.00 per
cent. of the Enlarged Share Capital, and AOP and its concert parties will hold
584,284,234 Ordinary Shares in aggregate, representing 54.51 per cent. of the
Enlarged Share Capital. In the event that no RetailBook Offer Shares are
issued, following the Subscription, AOP (excluding its concert parties) will
hold 568,007,521 Ordinary Shares, representing approximately 54.70 per cent.
of the Enlarged Share Capital and AOP together with its concert parties will
hold 584,284,234 Ordinary Shares representing approximately 56.26 per cent. of
the Enlarged Share Capital.
The following table sets out the shareholdings of AOP and each member of the
concert party as at the date of this announcement and also upon completion of
the Subscription under two scenarios: i) there is full take-up under the
RetailBook Offer and ii) there is no take-up under the RetailBook Offer:
Shareholder Shareholding as at the date of this announcement Percentage of Existing Ordinary Shares Number of Subscription Shares to be subscribed for Number of Ordinary Shares held post completion of the Subscription Percentage of the Enlarged Share Capital if there is full take-up under the Percentage of the Enlarged Share Capital if there is no take-up under the
RetailBook Offer RetailBook Offer
AOP 311,597,265 39.84 256,410,256 568,007,521 53.00 54.70
Dr. Christian Schweiger 11,651,713 1.49 Nil 11,651,713 1.09 1.12
Dr. Günther Krumpl 4,000,000 0.51 Nil 4,000,000 0.37 0.39
Michael Steiger 625,000 0.08 Nil 625,000 0.06 0.06
Total 327,873,978 41.93 256,410,256 584,284,234 54.51 56.26
Completion of the Subscription is conditional on the passing of the
Resolutions at the General Meeting and Subscription Admission. Accordingly, if
the Resolutions are not passed at the General Meeting, the Subscription will
not proceed and the Company will not receive the proceeds from the
Subscription. The Company intends to use the net proceeds of the Subscription
to support commercial expansion and for general working capital purposes.
When issued, the Ordinary Shares to be issued pursuant to the Subscription
will be fully paid and will rank pari passu in all respects with the Existing
Ordinary Shares, including the right to receive all dividends and other
distributions declared, made or paid after the date of issue.
The Company and AOP entered into the Relationship Agreement to regulate the
relationship between the Company and AOP, as the Company's single largest
shareholder. The Relationship Agreement contains an undertaking from AOP to
abstain from voting on any resolution in relation to any proposed transaction
between the Group and the AOP Group. However, for the purposes of the
Subscription, the Company has provided AOP with its consent for AOP to vote on
Resolutions 2 and 3 at the General Meeting. AOP and its concert party members
will not be able to vote on the Waiver Resolution as they are not considered
independent.
In addition, in connection with the Subscription, the Relationship Agreement
has, conditionally on the passing of the Resolutions at the General Meeting
and Subscription Admission, been amended and restated to reflect AOP's
increased interest in the Company's share capital. The material changes being
made to the terms of the Relationship Agreement are set out in the Circular
and a copy of the Relationship Agreement will be available on the Company’s
website.
5. Intentions of AOP for the Company following the Subscription
AOP is committing funds to invest in the Company under the proposed
Subscription which will enable the Company to progress its strategy, as
described in this announcement and as may be developed over time.
AOP is a long-term shareholder of the Company and supports the strategic plans
of the Board to commercialise ACCRUFeR®, the Company’s sole product. AOP is
especially focused on commercialising ACCRUFeR® in various geographies, with
a particular focus on the US, in order to provide sustainable growth for the
product and the Company and to make the Company cash flow positive.
5.1 Following the Subscription, AOP will be the majority shareholder of
Shield. As the majority shareholder of Shield, AOP will have the right to
appoint a majority of the members of the Board. AOP does not have any
intention of changing the composition of the Board before the Company's 2026
Annual General Meeting. However, depending upon the progress made with
commercialising ACCRUFeR®/Feraccru® and the Company's financial situation,
AOP may decide to exercise its right to do so over the next 12 to 18 months.
Following the date of Subscription Admission, AOP will work alongside the
Board to review the business of the Group, with a view to ensuring the ongoing
business operations are increasing the Group's revenue and improving its
performance. As part of this review, the Board and AOP may also consider
whether further capital injections are required and, if so, AOP would only
take such actions in accordance with applicable law and the AIM Rules. Whilst
there are no new or additional immediate plans regarding changes to Shield's
business, some operational and administrative restructuring may be required to
help to ensure Shield reaches its revenue aims but neither the Board nor AOP
have made any decisions about how such optimization could be carried out, if
at all. AOP is committed to supporting Shield’s success and has every
intention to act in the best interests of the Company and, in turn, to seek to
improve the valuation of the Company for all Shareholders. Assuming the
Company performs in line with AOP’s and the Board’s expectations, there is
not expected to be any material impact on headcount. However, should the
Company fail to meet the Board’s targets, or if AOP determines (acting
reasonably) that the Company is underperforming, then it is likely that
further restructuring will be required, and this could result in headcount
reductions within any of the underperforming business areas (or such other
areas as AOP may determine such restructuring is required), which could be
material within those businesses and in the context of the Group’s overall
headcount.
AOP has no intention of changing the location of the Group’s headquarters or
redeploying the fixed assets of the Group. In addition, AOP does not have any
intentions of changing the contributions into the Group’s pension schemes,
the accrual of benefits for existing members and the admission of new members.
AOP does not have any intentions that would affect the maintenance of the
existing trading facilities of the Ordinary Shares on AIM.
AOP does not plan to make any changes to AOP or any of its subsidiaries
following the date of Subscription Admission.
AOP will use existing cash resources to finance the Subscription. The
Subscription will not have a material effect on the earnings, assets or
liabilities of AOP.
AOP has not put in place, and does not intend to put in place, any
incentivisation arrangements for the Company’s management in connection with
the Subscription.
6. The City Code on Takeovers and Mergers and the Panel Waiver
The Takeover Code is issued and administered by the Panel. The Takeover Code
and the Panel operate to ensure fair and equal treatment of shareholders in
relation to takeovers, and also provide an orderly framework within which
takeovers are conducted. The Takeover Code applies to the Company and as such
Shareholders are entitled to the protections afforded by the Takeover Code.
Under Rule 9, any person who acquires an interest in shares which, taken
together with shares in which that person or any person acting in concert with
that person is interested, carry 30 per cent. or more of the voting rights of
a company which is subject to the Takeover Code, is normally required to make
an offer to all the remaining shareholders to acquire their shares.
Similarly, when any person, together with persons acting in concert with that
person, is interested in shares which in the aggregate carry not less than 30
per cent. of the voting rights of a company but does not hold shares carrying
more than 50 per cent. of the voting rights of the company, an offer will
normally be required if such person or any person acting in concert with that
person acquires a further interest in shares which increases the percentage of
shares carrying voting rights in which that person is interested.
An offer under Rule 9 must be in cash at the highest price paid by the person
required to make the offer, or any person acting in concert with such person,
for any interest in shares of the company acquired during the 12 months prior
to the announcement of the offer.
Rule 9 of the Takeover Code further provides, amongst other things, that where
any person who, together with persons acting in concert with that person,
holds over 50 per cent. of the voting rights of a company and acquires an
interest in shares which carry additional voting rights, then they will not
normally be required to make a general offer to the other shareholders to
acquire their shares. However, the Panel may deem an obligation to make an
offer to have arisen on the acquisition by a single member of a concert party
of an interest in shares sufficient to increase their individual holding to 30
per cent. or more of a company's voting rights or, if they already hold more
than 30 per cent. but less than 50 per cent., an acquisition which increases
their shareholdings in that company.
Under the Takeover Code, persons acting in concert comprise persons who,
pursuant to an agreement or understanding (whether formal or informal),
co-operate to obtain or consolidate control of a company or to frustrate the
successful outcome of an offer for a company. Control means an interest or
interests in shares carrying 30 per cent. or more of the voting rights of the
company, irrespective of whether the holding or holdings give de facto
control.
The Company has agreed with the Panel that AOP and the AOP Directors are
acting in concert in relation to the Company.
AOP (excluding its concert parties) currently holds 311,597,265 Ordinary
Shares, representing 39.84 per cent. of the Company's issued share capital.
AOP, the AOP Directors and persons acting in concert with AOP currently hold,
in aggregate, 327,873,978 Ordinary Shares, representing 41.93 per cent. of the
Company's issued share capital. Following the Subscription, assuming the
maximum number of RetailBook Offer Shares are issued, AOP (excluding its
concert parties) will hold 568,007,521 Ordinary Shares, representing
approximately 53.00 per cent. of the Enlarged Share Capital, and AOP, the AOP
Directors and persons acting in concert with AOP will hold an aggregate of
584,284,234 Ordinary Shares, representing approximately 54.51 per cent. of the
Enlarged Share Capital. In the event that no RetailBook Offer Shares are
issued, following the Subscription, AOP (excluding its concert parties) will
hold 568,007,521 Ordinary Shares, representing approximately 54.70 per cent.
of the Enlarged Share Capital and AOP together with its concert parties will
hold 584,284,234 Ordinary Shares representing approximately 56.26 per cent. of
the Enlarged Share Capital. Therefore, under Rule 9 of the Takeover Code and
regardless of the level of take up under the RetailBook Offer, AOP would
ordinarily be required to make an offer to all the remaining Shareholders to
acquire their Ordinary Shares.
The Panel has agreed to waive the obligation to make an offer that would
otherwise arise under Rule 9 as a result of the Subscription, subject to the
approval of Independent Shareholders. Accordingly, the Waiver Resolution is
being proposed at the General Meeting and will be taken on a poll. The Panel
has confirmed that all Shareholders other than AOP and its concert parties
will be entitled to vote on the Waiver Resolution. Accordingly, each of AOP
and its concert party members will not vote on the Waiver Resolution.
In the event the Waiver Resolution is approved and the Subscription proceeds,
AOP will not be restricted from making a general offer for the Company.
Following Subscription Admission, AOP and its concert party will hold shares
carrying more than 50% of the voting rights of the Company and (for so long as
they continue to be acting in concert) may accordingly increase their
aggregate interests in shares without incurring any obligation to make an
offer under Rule 9, although individual members of AOP's concert party will
not be able to increase their percentage interests in shares through or
between a Rule 9 threshold without Panel consent.
The Panel Waiver will be invalidated if any purchases of Existing Ordinary
Shares are made by AOP or any of its concert parties in the period between the
date of the Circular and the General Meeting.
Further details concerning AOP and its concert parties are set out below:
Information on AOP
AOP is a provider of integrated therapy solutions from its operational
headquarters in Vienna, its subsidiaries and representative offices throughout
Europe and the Middle East, as well as through partners worldwide. AOP was
founded in 1996 and operates in the field of rare diseases and critical care.
The registered office of AOP and the business address of each of the AOP
Directors is Industriering 20, 9491 Ruggell, Liechtenstein.
For the year ended 31 December 2023, AOP Austria’s consolidated, audited,
turnover was EUR 254 million, net assets were EUR 122 million and net income
was EUR 24 million. For the year ended 31 December 2022, AOP Austria’s
consolidated, audited, turnover was EUR 187 million, net assets were EUR 99
million and net income was EUR 14 million. AOP Austria is a wholly-owned
subsidiary of AOP and its concert parties. Since AOP does not have significant
assets itself nor does it prepare consolidated financial statements, the
consolidated, audited accounts of AOP Austria provide a true and fair
representation of the AOP Group.
AOP employs more than 560 people in 30 countries, including countries in
Europe, the United Arab Emirates and Israel. AOP also has multiple strategic
partnerships through which it operates internationally.
AOP focuses on four areas and develops, produces and markets innovative
solutions in the treatment areas of Haemato-oncology, Cardiology &
Pulmonology, Intensive Care and Neurology.
AOP does not have any public, current credit rating or outlook from a ratings
agency.
AOP does not plan to make any changes to AOP or any of its subsidiaries if the
Subscription completes.
The names of the AOP Directors and their positions in AOP are below. Each of
Dr. Christian Schweiger and Dr. Rudolf Widmann are also directors of the
Company and receive compensation for their positions:
Name Position
Martin Gstöhl Director
Dr. Günther Krumpl Director
Dr. Rudolf Widmann Director
Dr. Christian Schweiger, MD. PhD Director
Michael Steiger Director
7. Irrevocable Undertakings
Each of the Directors (with the exception of Dr. Rudolf Widmann, who is not a
Shareholder) have given irrevocable undertakings to the Company to vote in
favour of the Resolutions (excluding, in the case of Dr. Christian Schweiger,
in relation to the Waiver Resolution), and to procure that such action is
taken by the relevant registered holders, in respect of their beneficial
holdings totalling 17,611,441 Ordinary Shares, representing approximately 2.29
per cent. of the Existing Ordinary Shares, to vote in favour of such
Resolutions.
In addition, AOP has given an irrevocable undertaking to the Company to vote
in favour of the Resolutions, other than the Waiver Resolution, and to procure
that such action is taken by the relevant registered holders, in respect of
AOP's beneficial holdings totalling 311,597,265 Ordinary Shares, representing
approximately 39.84 per cent. of the Existing Ordinary Shares, to vote in
favour of such Resolutions.
8. Principal terms of the RetailBook Offer
The Company has separately agreed to use RetailBook to undertake an
intermediaries offer of new Ordinary Shares at the Issue Price, alongside the
Subscription, to retail investors through financial intermediaries. For the
avoidance of doubt, the RetailBook Offer Shares are not part of the
Subscription. Given the shareholder base of the Company, the Directors
consider it important to extend the opportunity to invest in the Company at
the Issue Price to existing retail shareholders and the Directors have
concluded that the RetailBook Offer is the most suitable option available to
the Company. The Company intends to conduct an offer for subscription for the
RetailBook Offer Shares on the terms of the RetailBook Offer Announcement. The
RetailBook Offer is conditional on completion of the Subscription and
RetailBook Admission becoming effective no later than 8.00 am on 30 December
2024. The RetailBook Offer may not be fully subscribed. The RetailBook Offer
is intended to raise gross proceeds of up to £1.0 million if the maximum
number of RetailBook Offer Shares are issued. The Issue Price represents a
premium of approximately 5.3 per cent. to the closing middle market price of
an Ordinary Share on the Disclosure Date. Pursuant to the terms of the
Intermediaries Agreement,the Company will make the RetailBook Offer to retail
investors through intermediaries via RetailBook. The obligations of the
Intermediaries under the Intermediaries Agreement are conditional in all
respects upon: (a) the Subscription becoming unconditional; and (b) RetailBook
Admission.
Each of the Subscription and the RetailBook Offer are separate and distinct
transactions involving the issue of new Ordinary Shares. However, the
RetailBook Offer is conditional on the Subscription and will not be
implemented independently if for any reason the Subscription lapses. The
Subscription is not conditional upon the RetailBook Offer.
Neither AOP nor any of its concert parties will participate in the RetailBook
Offer.
9. Independent Advice
The Takeover Code requires the Directors to obtain competent independent
advice regarding the merits of the Subscription and the Panel Waiver. Peel
Hunt has provided formal advice to the Directors regarding the Subscription
and in providing such advice, Peel Hunt has taken into account the
Directors’ commercial assessments, as well as the confirmations of AOP's
future intentions expressed in paragraph 5 above.
Peel Hunt confirms that it, and any person who is or is presumed to be acting
in concert with it, is independent of AOP and has no personal, financial or
commercial relationship, or arrangements or understandings with AOP.
Peel Hunt has given and has not withdrawn its written consent to the inclusion
in this announcement of its name and the references to it in the form and
context in which they are included.
10. Admission, settlement, dealings and total voting rights
The Subscription Shares to be issued to AOP pursuant to the Subscription will,
when issued, be fully paid up and will rank pari passu in all respects with
the Existing Ordinary Shares, including the right to receive all dividends and
other distributions declared, made or paid on or in respect of the Ordinary
Shares after the date of issue of the Subscription Shares, and will on issue
be free of all claims, liens, charges, encumbrances and equities.
Any RetailBook Offer Shares that may be issued pursuant to the RetailBook
Offer will, when issued, be fully paid up and will rank pari passu in all
respects with the Existing Ordinary Shares, including the right to receive all
dividends and other distributions declared, made or paid on or in respect of
the Ordinary Shares after the date of issue of the Issued RetailBook Shares,
and will on issue be free of all claims, liens, charges, encumbrances and
equities.
Application will be made to the London Stock Exchange for the admission of the
Subscription Shares and of the Issued RetailBook Offer Shares to trading on
AIM. Admission of the Subscription Shares and of the Issued RetailBook Offer
Shares to trading on AIM is expected to occur at 8.00 a.m. on 30 December
2024.
Following Subscription Admission and RetailBook Admission, the total number of
Ordinary Shares in the capital of the Company in issue would be
1,071,799,957 (assuming the maximum number of RetailBook Offer Shares are
issued) with each Ordinary Share carrying the right to one vote.
11. General Meeting
The Company has called the General Meeting in order to (i) put to Independent
Shareholders the Waiver Resolution required to approve the Panel Waiver and to
(ii) put to Shareholders the other Resolutions set out in the notice of the
General Meeting at the end of the Circular. All of the Resolutions must be
passed by Shareholders at the General Meeting in order for the Subscription to
proceed.
The notice of General Meeting, which is proposed to be held at Northern Design
Centre, Baltic Business Quarter, Gateshead Quays, Newcastle NE8 3DF at 09:30
am on 24 December 2024, will be set out at the end of the Circular.
At the General Meeting the following Resolutions will be proposed:
Resolution 1 – Waiver Resolution
The Waiver Resolution will be proposed as an ordinary resolution to approve
the Panel Waiver. If passed it will approve the Panel Waiver and will allow
the issue of the Subscription Shares to AOP without AOP being required to make
a Mandatory Offer. The Takeover Code requires the Waiver Resolution to be
voted on by the Independent Shareholders only.
Resolution 2 – Authority to allot shares
Resolution 2 is an ordinary resolution to authorise the Directors to allot
relevant securities pursuant to the Subscription with an aggregate nominal
value of up to £3,846,154, being equal to 256,410,256 new Ordinary Shares.
Resolution 3 – Disapplication of statutory pre-emption rights
Resolution 3, which is conditional on the passing of Resolution 2, is a
special resolution to authorise the Directors to allot new Ordinary Shares
for cash on a non-pre-emptive basis pursuant to the Subscription.
The authorities given by the Resolutions 2 and 3 will be in addition to any
existing authorities which the Directors already have.
12. Importance of the Vote and RecommendationError! Bookmark not defined.
Shareholders should be aware that, if the Resolutions are not approved at the
General Meeting, the Subscription and the RetailBook Offer will not occur and
none of the net proceeds of the Subscription or the RetailBook Offer will be
received by the Company. Alternative funding may not be available to Shield
on suitable terms or at all. If the Company was not able to obtain additional
funding, the Group would only have sufficient working capital to trade through
to approximately Q2 of 2025. Shield’s rate of cash burn remains highly
dependent on the rate of sales growth of ACCRUFeR® in the US.
AIM Rule 13 Fair and Reasonable Opinion
The Subscription constitutes a related party transaction pursuant to Rule 13
of the AIM Rules. The Independent Directors, having consulted with Peel Hunt,
consider that the terms of the Subscription are fair and reasonable insofar as
Shareholders are concerned. Accordingly, the Independent Directors unanimously
recommend that Shareholders vote in favour of the of Resolutions numbered 2
and 3 to be proposed at the General Meeting.
Takeover Code Fair and Reasonable Opinion
The Independent Directors have noted AOP's statement that it is not prepared
to proceed with an equity investment in the Company unless it obtains a
controlling stake as a result. The Independent Directors have also carefully
considered the statements of AOP's future intentions expressed in paragraph 5
above and the Company's need for additional capital and the absence of
alternative feasible sources of capital.
The Independent Directors, having been so advised by Peel Hunt, consider the
terms of the Panel Waiver and the Subscription to be fair and reasonable and
in the best interests of the Independent Shareholders and the Company as a
whole. Accordingly, the Independent Directors unanimously recommend that the
Independent Shareholders vote in favour of the Waiver Resolution to be
proposed at the General Meeting.
In providing advice to the Independent Directors, Peel Hunt has taken into
account the Independent Directors' commercial assessments, including in
relation to the position and prospects of the Company in the event that the
Subscription is not completed, as well as the confirmations of AOP's future
intentions expressed in paragraph 5 above.
The Independent Directors who hold Ordinary Shares have irrevocably undertaken
to vote in favour of all Resolutions in respect of their own shareholdings
amounting to 5,959,728 Existing Ordinary Shares (representing 0.8 per cent. of
the Existing Ordinary Shares in issue).
For further information please contact:
Shield Therapeutics plc www.shieldtherapeutics.com (http://www.shieldtherapeutics.com/)
Anders Lundstrom, CEO +44 (0) 191 511 8500
Santosh Shanbhag, CFO
Nominated Adviser, Financial Adviser and Joint Broker
Peel Hunt LLP
James Steel/Patrick Birkholm +44 (0)20 7418 8900
Joint Broker
Cavendish Ltd
Geoff Nash/ Rory Sale/Nigel Birks/Harriet Ward +44 (0)20 7220 0500
Financial PR & IR Advisor
Walbrook PR
Alice Woodings / Lianne Applegarth +44 (0)20 7933 8780 or shield@walbrookpr.com (mailto:shield@walbrookpr.com)
About Iron Deficiency and ACCRUFeR®/FeRACCRU®
Clinically low iron levels (aka iron deficiency, ID) can cause serious health
problems for adults of all ages, across multiple therapeutic areas. Together,
ID and ID with anemia (IDA) affect about 20 million people in the US and
represent a $2.3B market opportunity. As the first and only FDA approved oral
iron to treat ID/IDA, ACCRUFeR® has the potential to meet an important unmet
medical need for both physicians and patients.
ACCRUFeR®/FeRACCRU® (ferric maltol) is a novel, stable, non-salt-based oral
therapy for adults with ID/IDA. The drug has a novel mechanism of absorption
compared to other oral iron therapies and has been shown to be an efficacious
and well-tolerated therapy in a range of clinical trials. More information
about ACCRUFeR®/FeRACCRU®, including the product label, can be found
at: www.accrufer.com (http://www.accrufer.com/) and www.feraccru.com
(http://www.feraccru.com/) .
About Shield Therapeutics plc
Shield is a commercial stage specialty pharmaceutical company that delivers
ACCRUFeR®/FeRACCRU® (ferric maltol), an innovative and differentiated
pharmaceutical product, to address a significant unmet need for patients
suffering from iron deficiency, with or without anemia. The Company has
launched ACCRUFeR® in the U.S. with an exclusive, multi-year collaboration
agreement with Viatris. Outside of the U.S., the Company has licensed the
rights to four specialty pharmaceutical companies. FeRACCRU® is
commercialized in the UK and European Union by Norgine B.V., which also has
marketing rights in Australia and New Zealand. Shield also has an exclusive
license agreement with Beijing Aosaikang Pharmaceutical Co., Ltd., for the
development and commercialization of ACCRUFeR®/ FeRACCRU® in China, Hong
Kong, Macau and Taiwan, with Korea Pharma Co., Ltd. for the Republic of
Korea, and with KYE Pharmaceuticals Inc. for Canada.
ACCRUFeR®/FeRACCRU® has patent coverage until the mid-2030s.
ACCRUFeR®/FeRACCRU® are registered trademarks of Shield Therapeutics.
Forward-Looking Statements
This press release contains forward-looking statements. All statements
contained in this press release that do not relate to matters of historical
fact should be considered forward-looking statements. These forward-looking
statements are based on management's current expectations and include
statements related to the commercial strategy for ACCRUFeR®/FeRACCRU®. These
statements are neither promises nor guarantees, but involve known and unknown
risks and uncertainties, many of which are beyond our control, that may cause
actual results and performance or achievements to be materially different from
management's expectations expressed or implied by the forward-looking
statements, including, but not limited to, risks associated with the Company's
business and results of operations, competition and other market factors.
The forward-looking statements made in this press release represent
management's expectations as of the date of this press release, and except as
required by law, the Company disclaims any obligation to update any
forward-looking statements contained in this release, even if subsequent
events cause its views to change.
ADMISSION STATISTICS
SUBSCRIPTION AND RETAILBOOK OFFER STATISTICS((1))
Issue Price 3.0 pence
Issue Price premium to closing middle market price of an Ordinary Share on the 5.3%
Disclosure Date
Number of Existing Ordinary Shares 782,056,367
Number of Subscription Shares 256,410,256
Maximum number of RetailBook Offer Shares 33,333,333
Subscription Shares as a percentage of Existing Ordinary Shares 32.79%
Maximum number of RetailBook Offer Shares as a percentage of Existing Ordinary 4.26%
Shares
Percentage of Existing Ordinary Shares held by AOP only as at the date of this 39.84%
announcement((2))
Percentage of Existing Ordinary Shares held by AOP and its concert parties as 41.93%
at the date of this announcement
Enlarged Share Capital following Subscription Admission and RetailBook 1,071,799,957
Admission assuming the maximum number of RetailBook Offer Shares are issued
Percentage of the Enlarged Share Capital held by AOP only following completion 53.00%
of the Subscription assuming the maximum number of RetailBook Offer Shares are
issued((2) )
Percentage of the Enlarged Share Capital held by AOP only following completion 54.70%
of the Subscription assuming no RetailBook Offer Shares are issued((2))
Percentage of the Enlarged Share Capital held by AOP and its concert parties 54.51%
following completion of the Subscription assuming the maximum number of
RetailBook Offer Shares are issued
Percentage of the Enlarged Share Capital held by AOP and its concert parties 56.26%
following completion of the Subscription assuming no RetailBook Offer Shares
are issued
Gross proceeds of the Subscription((3)) $10,000,000
Maximum gross proceeds of the RetailBook Offer £1,000,000
ISIN of the Ordinary Shares GB00BYV81293
LEI Number 213800G74QWY15FC3W71
Notes:
1. Assuming the Resolutions are passed.
2. Excluding AOP's concert parties.
3. At an exchange rate of USD 1.3:GBP 1 agreed between Shield and AOP.
DEFINITIONS
The following definitions apply throughout this announcement, unless the
context requires otherwise:
acting in concert has the
definition given in the Takeover Code;
AIM
the market of that name operated by the London Stock Exchange;
AIM Rules
the AIM Rules for Companies published by the London Stock Exchange from
time to time;
AOP
AOP Health International Management AG;
AOP Austria AOP
Orphan Pharmaceuticals GmbH;
AOP Directors the
directors of AOP, from time to time;
AOP Group AOP
and its subsidiary undertakings, from time to time;
Articles
the articles of association of the Company;
CA 2006
the Companies Act 2006 as amended;
Company or Shield Shield
Therapeutics plc, incorporated and registered in England and Wales (with
registration number 09761509), whose registered office is at Northern Design
Centre Studio 6, 3rd Floor, Baltic Business Quarter, Gateshead Quays, England,
NE8 3DF;
concert parties persons
who are acting in concert as defined in the Takeover Code;
CREST
the computerised settlement system (as defined in the CREST Regulations)
operated by Euroclear which facilitates the holding and transfer of title to
shares in uncertificated form;
CREST Regulations the
Uncertificated Securities Regulations 2001 (SI 2001 No. 2001/3755) and any
modification thereof or any regulations in substitution thereof for the time
being in force;
Directors or Board the
directors of the Company;
Disclosure Date 5 December
2024 being the latest practicable date prior to the publication of this
announcement;
Enlarged Share Capital the issued ordinary
share capital of the Company immediately following Subscription Admission and
RetailBook Admission (comprising the Existing Ordinary Shares, the
Subscription Shares and Issued RetailBook Offer Shares);
Euroclear
Euroclear UK & International Limited, the operator of CREST;
Existing Ordinary Shares the 782,056,367
Ordinary Shares in issue at the date of this announcement;
FCA
the Financial Conduct Authority of the United Kingdom;
Form of Proxy the
form of proxy for use by Shareholders in relation to the General Meeting;
General Meeting the
general meeting of the Company to be held at Northern Design Centre, Baltic
Business Quarter, Gateshead Quays, Newcastle NE8 3DF at 09:30 am on 24
December 2024, notice of which is set out at the end of the Circular;
Group
the Company and its subsidiaries and subsidiary undertakings;
Independent Directors the Directors,
other than Dr. Christian Schweiger and Dr. Rudolf Widmann;
Independent Shareholders the Shareholders other
than AOP and its concert parties;
Irrevocable Undertakings the irrevocable
undertakings and consents received by the Company from the Directors and AOP
to vote in favour of the Resolutions (excluding, in the case of Dr. Christian
Schweiger, in relation to the Waiver Resolution)
Issue Price
3.0 pence per Ordinary Share;
Issued RetailBook Offer Shares such number of RetailBook Offer
Shares that are issued
pursuant to the RetailBook Offer (if
any);
London Stock Exchange London Stock Exchange
plc;
MAR
Regulation (EU) No.596/2014 of the European Parliament and of the Council
of 16 April 2014 on market abuse including as it forms part of domestic law in
the United Kingdom by virtue of the EUWA including by the Market Abuse
(amendment) (EU Exit) Regulation 2019;
Ordinary Shares ordinary
shares of 1.5 pence each in the capital of the Company;
Panel
the UK Panel on Takeovers and Mergers;
Panel Waiver the
waiver granted by the Panel (subject to the passing of the Waiver Resolution
by the Independent Shareholders) in respect of an obligation of AOP and its
concert parties (individually and collectively) to make a mandatory general
offer pursuant to Rule 9 as a result of the issue of the Subscription Shares
Relationship Agreement the relationship
agreement dated 4 May 2023 between AOP and the Company (as amended and
restated from time to time), which regulates the relationship between AOP, as
the Company’s largest shareholder and the Company
Registrar
Link Group;
Resolutions the
resolutions to be proposed at the General Meeting as set out in the notice of
the General Meeting at the end of the Circular;
RetailBook
Retail Book Limited of 10 Queen Place, London, EC4R 1AG which is authorised
and regulated by the Financial Conduct Authority (FRN: 99423) and is the
retail capital markets platform undertaking the RetailBook Offer;
RetailBook Admission admission of the
Issued RetailBook Offer Shares to trading on AIM becoming effective in
accordance with Rule 6 of the AIM Rules;
RetailBook Offer the offer
of up to 33,333,333 RetailBook Offer Shares on the terms of the RetailBook
Offer Announcement;
RetailBook Offer Announcement the regulatory information service
announcement issued by the Company dated 6 December 2024 in relation to the
RetailBook Offer;
RetailBook Offer Shares up to 33,333,333 new
Ordinary Shares which the Company is proposing to offer to existing retail
shareholders of the Company pursuant to the RetailBook Offer;
Rule 9
Rule 9 of the Takeover Code;
Sallyport
Sallyport Commercial Finance, LLC;
Shareholders holders
of Ordinary Shares;
Shield US
Shield Therapeutics Inc., a company incorporated in Delaware and a wholly
owned subsidiary of the Company;
STX UK
Shield TX (UK) Limited, a company incorporated in England and Wales under
company number 06702064 and a wholly owned subsidiary of the Company;
Subscription the
proposed subscription by AOP for the Subscription Shares at the Issue Price
pursuant to the Subscription Agreement;
Subscription Admission admission of the
Subscription Shares to trading on AIM becoming effective in accordance with
Rule 6 of the AIM Rules;
Subscription Agreement the subscription
agreement entered into between the Company and AOP on or about the date hereof
in relation to the Subscription
Subscription Shares the 256,410,256
new Ordinary Shares which the Company is proposing to issue to AOP pursuant to
the Subscription;
subsidiary and subsidiary have the meaning
given to them in the CA 2006;
undertakingSWK SWK Funding
LLC;
Takeover Code the UK
City Code on Takeovers and Mergers as issued, and as from time to time amended
and interpreted by, the Panel;
UK or United Kingdom the United Kingdom
of Great Britain and Northern Ireland;
Uncertified or in uncertificated form recorded on the relevant register
of the share or security concerned as being held in uncertified form in
CREST and title to which, by virtue of the CREST Regulations, may be
transferred by means of CREST;
US or United States the United
States of America, its territories and possessions, any state of the United
States of America and the District of Columbia and all other areas subject to
its jurisdiction; and
Waiver Resolution the ordinary
resolution of the Independent Shareholders to approve the Panel Waiver to be
proposed and held on a poll at the General Meeting which is set out in the
notice of General Meeting at Resolution 1.
Unless otherwise indicated, all references in the is announcement to "GBP"
"£", "pounds sterling", "sterling", "pence" or "p" are to the lawful currency
of the United Kingdom and all references to "$", "US$", "USD" or "US dollars"
are to the lawful currency of the United States.
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