Provexis (PXS)

 

LSE:PXS: Funding Update

Provexis

02 May 2017 07:15:02

Provexis PLC

RNS Number : 8472D
Provexis PLC
02 May 2017
 

2 May 2017

Provexis plc

 

Funding Update

 

Provexis plc ('Provexis' or the 'Company'), the business that develops, licenses and sells the proprietary, scientifically-proven Fruitflow® heart-health functional food ingredient, is pleased to announce a funding update. The funding update follows guidance from the Company in its interim results, released on 30 December 2016, that the business would need to raise further equity finance in the first four months of 2017.

 

The Company today announces that it is in late stage discussions with a small group of investors in relation to two subscriptions to raise further working capital for the Company.

 

First Subscription - completion expected in May 2017

The Directors currently have legally binding commitments in the First Subscription to raise £170,000 at a subscription price of 0.50 pence per ordinary share, and non-legally binding indications of interest in the First Subscription to raise approximately a further £30,000 at 0.50 pence per ordinary share. No commissions or expenses will be payable on the First Subscription.

 

A further announcement concerning the First Subscription will be made by the Company on or before Wednesday 10 May 2017.

 

Second Subscription - completion expected in June 2017

The Company has applied to Her Majesty's Revenue and Customs ('HMRC') for advance assurance that it would be eligible to issue new ordinary shares under HMRC's Enterprise Investment Scheme ('EIS'). The Company is listed on the Alternative Investment Market ('AIM') which is not considered by HMRC to be to be a 'recognised exchange' under the EIS rules, which means that AIM listed companies can raise money under EIS if they satisfy all the necessary conditions.

 

The Company has received positive EIS advance assurance clearance from HMRC on a number of previous occasions, most recently in July 2012, and it has previously issued shares under EIS. However, the EIS eligibility rules for companies and investors have undergone a number of changes in recent years hence the need to submit a new advance assurance application, as requested by a number of prospective investors in the planned Second Subscription.

 

The Directors currently have non-legally binding indications of interest in the Second Subscription to raise approximately £370,000 at a subscription price of 0.50 pence per ordinary share with no commissions or expenses payable, of which approximately £250,000 is likely to be subject to the Company receiving positive EIS advance assurance clearance from HMRC.

 

The process of obtaining full EIS advance assurance clearance from HMRC is likely to take some weeks, and the outcome from this process is currently uncertain given recent changes to the EIS eligibility rules for companies and investors. A further announcement concerning EIS and the related Second Subscription will be made by the Company in due course, likely in June 2017.

 

The Company highly values its private investor base and believes that it would be appropriate to provide private investors with an opportunity to participate in the Second Subscription at 0.50 pence per ordinary share through the Company's existing access to the PrimaryBid.com platform. Subscriptions through the PrimaryBid.com platform, which are expected to be eligible for EIS if the Company receives positive EIS advance assurance clearance from HMRC, will be considered by the Company on a 'first come, first served' basis subject to conditions, with any investment request over £40,000 first requiring the Company's consent. The Company will provide further details of this process in due course.

 

The First and Second Subscriptions, to include the PrimaryBid.com element of the Second Subscription, are not being underwritten.

 

Whilst the final amount which the Company can expect to receive from these Subscriptions cannot yet be determined, in part due to the currently uncertain outcome of the EIS advance assurance clearance process, total Subscriptions are currently expected to exceed a minimum of £320,000. If the Company receives positive EIS advance assurance clearance from HMRC total Subscriptions are currently expected to exceed a minimum of £570,000.

 

Further announcements concerning the planned First and Second Subscriptions above will be made by the Company at the appropriate time.

 

The Company and DSM have seen an encouraging increase in brand awareness and customer interest in Fruitflow® in recent months. The total projected annual sales value of the prospective sales pipeline for Fruitflow® has continued to increase and it now stands at an all-time high level.

 

The Company's Fruitflow® + Omega-3 dietary supplement product was launched at the end of June 2016 and it achieved sales of £7k in the three month period to 30 September 2016. In recent months, following some limited digital and other marketing investment, the rate of sales for the product has more than doubled relative to the initial launch period, with more than half of recent sales coming from customers on monthly subscriptions. Further UK sales channel opportunities for the product are currently being progressed, and some international sales channel opportunities are being explored.

 

The Company plans to issue a full trading update on or before Wednesday 10 May 2017.

 

This announcement contains inside information.

 

 

ends-

 

For further information please contact:

 

Provexis plc                                                     Tel:      07490 391888

Dawson Buck, Chairman                                             [email protected]

Ian Ford, Finance Director

 

Cenkos Securities plc                                      Tel:      020 7397 8900

Bobbie Hilliam

 

 

Notes for editors

 

About Provexis plc

AIM-listed Provexis is focused on the development and licensing of its proprietary, scientifically-proven Fruitflow® heart-health functional food ingredient.

 

In May 2009, the Company's Fruitflow® technology was the first to be substantiated by the European Food Safety Authority ("EFSA") under the new Article 13(5) for proprietary and emerging science. In December 2009 the European Commission authorised the health claim "Helps maintain normal platelet aggregation, which contributes to healthy blood flow", which was the first wording to be authorised under Article 13(5).

 

In June 2010 it was announced that the Company had entered into a long-term Alliance Agreement with DSM Nutritional Products to commercialise Fruitflow®, and in June 2015 the Company confirmed it had agreed significantly enhanced financial terms for its Alliance Agreement with DSM for Fruitflow®.

 

The Company's Alliance partner DSM Nutritional Products has developed the market actively for the Company's novel, patented Fruitflow® heart-health ingredient in all global markets, with over 50 regional consumer healthcare brands now having been launched by direct customers of DSM, and with a number of further regional brands having been launched through DSM's distributor channels.

 

An increasing number of further commercial projects have been initiated by DSM with prospective customers, including some prospective customers which are part of global businesses, with good prospects for these projects to be launched as consumer products. Interest in the technology exists in all major global markets.

 

In June 2016 the Company launched a high quality dietary supplement product containing Fruitflow® and Omega-3 which is being sold initially from a separate, dedicated website www.fruitflowplus.com on a mail order basis.

 

The Company conducted a Key Opinion Leaders' roundtable event for Fruitflow® in London on 29 September 2016, focussed on raising awareness of the importance of blood flow in cardiovascular health, and the effectiveness of dietary antiplatelets. The roundtable was attended by key scientists from Provexis and DSM, along with a number of interested health care professionals with close links to the media. The event was recorded and a video for Fruitflow® + Omega-3 capsules targeting prospective consumers can be seen here www.youtube.com/watch?v=P3HCSdyupEY&t=48s

 

The Company and DSM are keen to secure greater medical advocacy for Fruitflow® and the roundtable event forms part of this strategy.

 

The roundtable event is being supported by a broader consumer PR campaign, and the Company's Fruitflow® + Omega-3 dietary supplement product has featured in a number of recent articles in the UK national press which can be seen here www.fruitflowplus.com/fruitflow-in-the-media

 

The Company has been engaged in a two stage collaboration agreement with the University of Oslo to undertake further research into the relationship between Fruitflow® and blood pressure regulation. In December 2016 the Company announced the results from the second stage of the collaboration, a pilot study which indicated that a standard dose of Fruitflow® in powder format significantly lowered average 24-hour systolic blood pressure compared to placebo. Both systolic and diastolic blood pressure were shown to be significantly lower whilst trial subjects were awake, a clinically relevant reduction in blood pressure which is expected to be of interest to a large number of consumers and patients with a wide range of cardiovascular conditions.

 

In April 2017 the Company announced that it had entered into a memorandum of understanding with BY-HEALTH Co., Ltd ('BY-HEALTH') which is intended to result in a research and collaboration agreement with BY-HEALTH for Fruitflow®. The Company also confirmed separately that Provexis and DSM are working with BY-HEALTH to support the planned launch of some Fruitflow® based products in the Chinese market, with the first launch envisaged in the second half of 2017.

 

BY-HEALTH is a substantial Chinese listed dietary supplement business which is currently valued in excess of £1.7bn.

 

Provexis was founded in 1999 and is headquartered in Reading, Berkshire.

 

Provexis shares are traded on the AIM market of the London Stock Exchange under the ticker symbol PXS.

 

For further information, please visit www.provexis.com

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
MSCGLGDUBBGBGRD