10 April, 2024
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Proposed Fundraise of £28.9m and Cancellation

Proposed fundraise of £28.90 million by way of a Share Subscription

Proposed cancellation of admission of Ordinary Shares to trading on AIM and Notice of General Meeting

London, UK, 10 April 2024 – e-therapeutics plc (AIM: ETX), a company integrating computational power and biological data to discover life-transforming RNAi medicines, today announces:

  • a proposed fundraise of £28.90 million before expenses by way of a subscription for 192,666,667 new ordinary shares of 0.1p each (“Ordinary Shares”) in the Company (the "Subscription Shares”) at a price of 15p per Ordinary Share (the "Subscription Price") by funds managed by M&G Investment Management Limited (“M&G”) and Richard Griffiths and his controlled undertakings (“Richard Griffiths”) (together the "Subscribers"), existing shareholders of the Company (the “Subscription”); and
  • the proposed cancellation of admission of its Ordinary Shares to trading on AIM ("Cancellation").

The Company has a current cash position of approximately £18 million and the gross proceeds from the proposed fundraise of £28.90 million will considerably strengthen its balance sheet. In addition, the Company has an intention to cancel its admission to AIM and subsequently explore the option of listing on NASDAQ in due course.

The Subscription and the Cancellation are conditional upon, inter alia, shareholder approval which will be sought at a forthcoming general meeting to be held at 12:30 p.m. on 29 April 2024 at the Company’s office at Unit 4B, Floor 4, 4 Kingdom Street, Paddington Central, London, W2 6BD ("General Meeting"). The Company will therefore be posting a circular to shareholders ("Circular") convening the general meeting and seeking shareholder authority in relation to the proposed Subscription (the "Share Authority Resolutions") and Cancellation (the "Cancellation Resolution") later today. The Company has received irrevocable undertakings from the Subscribers, representing approximately 46.68 per cent. of the Company’s existing Ordinary Shares (the "Existing Ordinary Shares"), to vote in favour of the Share Authority Resolutions and the Cancellation Resolution (together, the "Resolutions"). Additionally, the Directors have indicated their intention to vote their entire holdings in favour of the Resolutions which amount to interests in 52,735,562 Ordinary Shares, representing approximately 9.0 per cent. of the Existing Ordinary Shares.

The Circular will set out the background to and reasons for the proposed Cancellation, additional information on the implications of the Cancellation for the Company and its shareholders and why the Board believes it to be in the best interests of the Company and of the shareholders as a whole.

Ali Mortazavi, CEO of e-therapeutics plc, said:

"For over a year, the Board has been contemplating delisting from the AIM market. However, given the dramatic rise in the US biotech indices in Q3 2023 which has seen record amounts of capital being raised, we decided to remain on the AIM market and embarked on a capital raise roadshow in February-March 2024. Despite the firm commitments given by our two largest shareholders, the Board was extremely disappointed by the lack of institutional UK interest in our innovative, technology-driven value propositions. Importantly, ETX struggled to get sufficient engagement from the vast majority of the institutions who were approached, reflecting the risk appetite of the UK markets. This trend has been a consistent theme over the last four years and the Company has primarily raised funds through the current two key shareholders, who continue to support the Company irrespective of its listing status. As such, we believe that there is a limited available audience on the AIM market for companies such as ETX.

“The Board believes that the current valuation of ETX in no way reflects the Company’s position as a leading TechBio company, with powerful enabling technologies both on our computational and genetic medicines platforms, and a maturing pipeline of differentiated RNAi assets. ETX is active and has specialist expertise in the most disruptive and attractive areas in biotech. However, it is the Board’s view that there could be a far larger pool of capital available as an unlisted company as opposed to an AIM listed one and that this situation is very unlikely to change in the near future.

“We understand that there will be a short-term reduction in liquidity as a result of this decision but we are of the firm belief that it is in the best interest of all shareholders to delist from the AIM market, with a strong cash position of approximately £47 million following this fundraise. We have also stated our willingness to explore relisting the Company in the future on the US NASDAQ exchange where the large gap in the valuation of ETX compared to its US peers can hopefully be narrowed. I would also like to take this opportunity to thank both Richard Griffiths and M&G for their continued support and we look forward to regularly updating shareholders on our progress."

Use of proceeds from the fundraise

With a current cash position of approximately £18 million together with gross proceeds from the fundraise of £28.90 million, the Company will advance multiple GalOmic™ pipeline assets towards the clinic and initiate clinical trials on one program. The Company also plans to use the proceeds to keep its early pipeline well populated by pursuing further candidates. The strengthened cash position will enable the accelerated development and integration of cutting-edge AI systems into HepNet™. Additionally, the Company will explore the option of listing on NASDAQ in due course, if it is felt that the Company has made sufficient progress and that such a course of action would be beneficial. There is no certainty that such a listing will be achievable in any given time frame.

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