Biotechnology company raises proceeds for general corporate purposes
By Devika Patel and Stephanie A. Rotondo
Knoxville, Tenn., Sept. 24 - Oncothyreon Inc. said it will sell about 4.24 million units at $3.50 per unit to raise approximately $14.9 million in a private placement. JMP Securities LLC is the lead placement agent, and ROTH Capital Partners, LLC is the co-agent.
The purchase price per unit represents a discount of approximately 7.2% to the 30-day trailing volume-weighted average price of the company's common stock through Sept. 23.
The units will each consist of one common share and one warrant for three-quarters of a share. Each whole five-year warrant will be exercisable at $4.20, which is identical to the Sept. 23 closing share price.
"It's a very good company run by some folks that have deep knowledge of cancer vaccines and cancer therapeutics," said Bob Carey of JMP Securities.
He added that the financing would allow the company to raise "enough capital to provide answers on several clinical trials that will create value for shareholders," noting that there were "several milestones in the near future that should help in terms of stock appreciation."
When asked why the deal was structured as it is - stock and warrants - Carey said "because that is the way the market is operating for companies like Oncothyreon.
"They are not going to have earnings and revenues for some period of time," he explained. As such, the "terms were necessary to attract capital.
"It is what is required to get [investors] to buy stock."
Settlement is expected Sept. 28.
Proceeds will be used for general corporate purposes.
Oncothyreon is a Seattle-based biotechnology company.
| Issuer: | Oncothyreon Inc.
|
| Issue: | Units of one common share and one warrant for three-quarters of a share
|
| Amount: | $14.9 million (approximate)
|
| Units: | 4.24 million (approximate)
|
| Price: | $3.50
|
| Warrants: | One warrant for three-quarters of a share per unit
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $4.20
|
| Agent: | JMP Securities LLC (lead), ROTH Capital Partners, LLC (co-agent)
|
| Pricing date: | Sept. 24
|
| Settlement date: | Sept. 28
|
| Stock symbol: | Nasdaq: ONTY
|
| Stock price: | $4.20 at close Sept. 23
|
| Market capitalization: | $85.96 million
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
