Exalenz Bioscience Ltd. (TASE:EXEN) will hold a NIS 20 million rights issue, amounting to 17.6% of its shares.
Each shareholder will have the right to purchase five new shares for every 24 shares or warrants currently in their possession. The ex-rights price for the shares is NIS 0.9118, compared with yesterday's opening price of NIS 0.92.
Two of Exalenz's largest shareholders - Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL), which owns 16.3%, and Moshe (Mori) Arkin, who owns 38.7% - have already said that they will participate in the rights issue. Hadasit Bio Holdings Ltd. (TASE:HDST), which owns 14.9%, has not said whether it will participate.
A number of biomed companies have held secondary offerings on the basis of shelf prospectuses in recent months.
In a separate development, Exalenz announced that it intends to enter the liver disease diagnostic field. The company published a report it commissioned from Easton Associates, which states, "There is a real need for Exalenz's device, which makes possible non-invasive tests of the liver."
On the basis of the report, Exalenz's board of directors approved a plan to develop, license, and market the company's products for liver disease diagnosis. A substantial part of the proceeds of the rights issue will be used for this purpose.
Easton Associates advised to focus on two applications for using Exalenz's BreathID device: to make non-invasive hepatic venous pressure gradient (HVPG) measurements in chronic liver disease; and to measure fatty tissue for non-alcoholic steatohepatitis (NASH). The price per test will be $260 in both cases. The HVPG diagnostic has a potential market of $44 million, but the initial potential market for NASH is $700 million, and will likely rise.
A trial for the BreathID test for HVPG is scheduled to conclude in 2013, and the trial for NASH in 2014.
Easton Associates also advises developing the BreathID for diagnosing hepatitis C acute liver disease, and cirrhosis.
Exalenz currently markets the BreathID for diagnosis of Helicobacter pylori (H. pylori) bacterium, a cause of ulcers. The company has installed 23 devices in the US and has orders for two more.
Exalenz's share price rose 4.8% in morning trading today to NIS 0.95, giving a market cap of NIS 98 million.
Published by Globes [online], Israel business news - www.globes-online.com - on February 2, 2011
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