Lifeclean: Directed new Share issue concluded - Redeye

Redeye comments on the directed share issue that was announced at the closing of the markets on 15 March. The issue was conducted through an accelerated book-building process and concluded before the markets opened today. We expected this to be done as the previous issue would not be enough to secure enough capital. The price is above the previous closing and is the volume-weighted average price during the last ten days. We had expected an even bigger issue in Q2 but recognize that it is a sign of strength to be able to do the issue at a premium in this market.
The proceeds, SEK 16m before costs, are communicated to accelerate the company’s expansion rate by strengthening its presence in new markets. Given the low shareholder’s equity at the end of 2023, an issue was also necessary to enhance that position. We had expected a total equity issue of SEK 25m in Q2, bringing the number of shares to 51.4 million. The new issue will bring the number of shares to 49.6m. The lower number of shares and fewer proceeds are more or less equal, which means that we maintain our Base case value of SEK 7 per share. With that said, the short-term financial worries are lower at this point with the issue, and with it done at a premium, it is a good signal of the shareholder’s support. There are a lot of potential positive surprises in the pipeline, given all the new agreements during the last 12 months; however, some of them must materialize as the total progress in patented product sales has been lower than expected.