After Crossject had announced the “preparation of the launch” of a c. €5m capital increase aimed at securing the needs of the group until the Emergency Use Authorization is reached (€5.8m if the extension clause is exercised), the group confirmed it will proceed with it. While it was doomed to happen, the real news that the market is expecting is of course the filing of Zepizure, still planned…for this month.
The group will issue new shares for an initial total amount of around €5m, with shareholders maintaining their preferential subscription rights, which may be increased to around €5.7m if the extension clause is exercised.
The issue price for the new shares set at €1.40 (a 22.6% discount to the closing price of the Crossject share on 3 June), with the subscription period running from 12 to 20 June.
As already communicated in May, approximately 60% will be allocated to the final development phases of ZEPIZURE and to the initiation of production steps, including the related build-up of inventories, ahead of any reimbursement by the U.S. partner while the remaining c. 40% will be used to finance R&D for its other projects, ZENEO Adrenaline and ZENEO Hydrocortisone.
With the net proceeds of the issue, the Company estimates that its net working capital would be sufficient to meet its obligations until the end of 2025, assuming the first payments from its American partner following the first deliveries.
As we mentioned earlier, this capital increase was bound to happen given the cash-burn of the group before Zepizure is launched (and cashed-in). The dilution, considering the c. 46m current number of shares, will be around 8% (9% with the extension clause) which we deem reasonable. That said, the key topic is and remains the filing of Zepizure expected “any time soon”.
We will integrate the impact of the dilution and the benefit of the cash inflow in the group’s balance sheet.
