D Medical Industries Ltd. (TASE:DMDC) has raised NIS 10.5 million in a private placement of bonds among four investors, whose identity it declined to disclose. The company holds two companies that are developing diabetes treatments. It has a market cap of NIS 131 million.
D Medical’s share has risen 62% since the beginning of June, while the company’s controlling shareholders, CEO Many Mor, Zeev Bronfield and Ituran co-CEO Eyal Sheratzky increased their holdings in it. Market sources attributed the rise to reports that subsidiary NiliMedix Ltd. was about to get US Food and Drug Administration (FDA) approval for its first product, an insulin pump. Today, the company announced that no approval would be forthcoming for several more months.
The bonds can be converted into D Medical shares at NIS 0.95 per share, compared with the share price of NIS 1.04 before the announcement. The company can compel the conversion if and when NiliMedix obtains FDA approval for its product. In today’s notice to the Tel Aviv Stock Exchange (TASE), D Medical said that it had been negotiating with investors for a long time and that the terms for the bond issue and conversion into shares had been determined before the recent sharp rise in its share.
D Medical’s share has fallen to around NIS 0.95 on the latest news, the price at which the bondholders may convert their bonds into shares.
Published by Globes [online], Israel business news - www.globes.co.il - on July 5, 2007
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