Proteologics Ltd. marked up an extraordinary success in its IPO on the Tel Aviv Stock Exchange (TASE) yesterday. The public offering was oversubscribed nearly three-fold, with NIS 100 million in orders for the units of shares and warrants, compared with the NIS 35 million that the company planned to raise.
In response, ProteoLogics raised the price of units by 23% to give a company value of NIS 147 million, after money. Clal Finance Underwriting Ltd. led the IPO, together with Meitav Issuing And Finance Ltd., Menora Mivtachim Underwriters & Management Ltd., Leumi Partners Ltd., and Barak Capital Underwriting Ltd.
The success of the offering will bring into effect ProteoLogics' investment agreement with GlaxosmithKline plc (NYSE; LSE: GSK), which will immediately invest $3 million in the company and make an additional $2 million payment to finance R&D. GlaxosmithKline is due to invest an additional $3.4 million in ProteoLogics over the coming years. The total investment could reach as much as $1 billion.
Two key factors played a role in the IPO's success: ProteoLogics' cooperation agreement with GlaxosmithKline, announced last week; and the general strong interest in Israeli biomedical companies in recent weeks.
Five biomedical companies have carried out or plan to carry out reverse merges with stock market shells, the TASE launched its Biomed Index yesterday to great acclaim, and there is a general appetite among investors for risk whetted by the market rally and the gushing oil exploration partnerships.
A source who participated in ProteoLogics' IPO said, "Even the underwriters were in shock by the demand."
Published by Globes [online], Israel business news - www.globes-online.com - on March 3, 2010
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