It has not been a positive day so far for investors, with the ASX market down following Wall Street's losses overnight. The All Ordinaries Index (ASX: XAO) has dropped 1.3% to 6,059 points.
The Starpharma Holdings Limited (ASX: SPL) share price is no different, falling 5.3% to $1.52 at the time of writing. This is despite the company announcing an oversubscribed institutional placement today.
Oversubscribed placement details
Starpharma advised it had successfully raised $45 million via a placement to domestic and international institutional investors. The placement received strong demand from existing institutional shareholders. In addition, the company noted that it also saw new large domestic and international funds on the register.
A share purchase plan (SSP) will follow for eligible shareholders at the same offer price of $1.50 per share. It is expected the SSP will raise approximately $5 million.
The placement will result in the issue of 30 million new shares, bringing the company's total issued capital to 402.8 million shares.
The new injection of funds will allow the company to advance its plans to fast-track the commercialisation and launch of its COVID-19 nasal spray. Starpharma will also seek to develop its Dendrimer Enhanced Product (DEP) candidates for future clinical trials.
Starpharma CEO, Dr Jackie Fairley was pleased with the result. She said:
The oversubscribed placement saw a high level of demand from offshore funds including large global and US-based funds. We appreciate the strong support from our current shareholders and are delighted to welcome several leading new institutional investors to the register.
Dr Fairley said the funds would enable Starpharma to expedite programs, including the novel SPL7013 COVID-19 nasal spray.
They will also allow the company to capitalise on value adding clinical combinations in our DEP portfolio and to advance development of a number of exciting DEP candidates across radiopharmaceuticals, ADCs and other therapeutic areas. Recent transactions, such as the Immunomedics acquisition by Gilead, illustrate the significant potential value of these areas.
About the Starpharma share price
The Starpharma share price moved higher since reporting its full-year results to the market in late August. The company is trading at 22% lower than its 52-week high of $1.95 achieved this month. With a market capitalisation of $559 million, Starpharma is in a strong position to rapidly grow its earnings if it can deliver on its targets.
