Imugene (IMU: $0.19) is raising up to $20 million through a placement and SPP at $0.18 per share with commitments of $16 million so far. Each share issued will be accompanied by an option, exercisable at $0.18 (expiring April next year).
The company has also amended its convertible note agreement. The new convertible notes will replace the existing notes. The notes can convert to shares at the lower of $0.18 per share, or 90% of the market price, with a floor price of $0.09 per share.
Imugene will have a pro forma cash balance of $30.6 million at Feb 1 assuming the full $20 million is raised. The company's operating cash burn in the December quarter was $13.4 million.
Imugene has been through a substantial restructure, with its staff count reducing to around 15 from 100. The main emphasis is on the company's Azer-cel technology, an allogeneic therapy that continues to deliver very good results. A licensing deal or acquisition is likely to be an objective this year for the company, with the continued capital raises having a strong downward pressure on its share price.
If the full $20 million is raised, Imugene will be capitalized at $78 million.
Bioshares recommendation: Speculative Hold Class B
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