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Advanced Oncotherapy (AIM: AVO), the developer of next-generation proton therapy systems for cancer treatment, is pleased to announce that the Open Offer announced on 14 October 2016 closed for acceptances at 11am yesterday and received valid acceptances in respect of 3,378,771 Open Offer Shares from Qualifying Shareholders. This represents 84 per cent of the Open Offer Shares and valid acceptances will therefore be satisfied in full. 

Admission

Application has been made for the 3,378,771 Open Offer Shares to be admitted to trading on AIM and it is expected that Admission will occur on 2 November 2016.

Following Admission, the Company’s enlarged issued share capital will comprise 72,188,674 Ordinary Shares, with voting rights. The Company does not hold any Ordinary Shares in treasury. Therefore the total number of Ordinary Shares in the Company with voting rights will be 72,188,674. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA’s Disclosure and Transparency Rules.

Capitalised terms used but not defined in this announcement have the same meaning as in the Open Offer Circular posted to shareholders on 14 October 2016. 

About Advanced Oncotherapy Plc www.avoplc.com

Advanced Oncotherapy is a provider of particle therapy systems with protons that harnesses the best in modern technology. As a result, Advanced Oncotherapy will offer healthcare providers affordable systems that will enable them to treat cancer with an innovative technology providing better health outcomes and fewer treatment related side effects. 

Advanced Oncotherapy is a provider of particle therapy with protons that harnesses the best in modern technology. Advanced Oncotherapy’s team “ADAM”, based in Geneva, focuses on the development of a proprietary proton accelerator called Linac Image Guided Hadron Technology (LIGHT). LIGHT accelerates protons to the energy levels achieved in legacy machines but in a unit that is a quarter of the size and between a quarter and a fifth of the cost. This compact configuration delivers proton beams in a way that facilitates a greater precision and electronic control which is not achievable with older technologies.

Advanced Oncotherapy will offer healthcare providers affordable systems that will enable them to treat cancer with an innovative technology as well as better health outcomes and lower treatment related side effects.

Advanced Oncotherapy continually monitors the market for any emerging improvements in delivering proton therapy and actively seeks working relationships with providers of these innovative technologies. Through these relationships, the Company will remain the prime provider of an innovative and cost-effective system for particle therapy with protons.

Advanced Oncotherapy Open Offer 

Posting of Circular

Further to the announcement made on 30 September 2016, the Company is pleased to announce details of the Open Offer.

Introduction

The Company announces that up to a maximum of approximately £4.02 million (being below the €5 million threshold which would require the publication by the Company of a prospectus under the Prospectus Rules) would be raised by way of an Open Offer made to Qualifying Shareholders of up to 4,020,587 Open Offer Shares. The Open Offer is being conducted on the basis of 1 Open Offer Share for every 13 Existing Ordinary Shares held as at the Record Date of 13 October 2016.

The Issue Price of 100 pence represents a discount of approximately 3.4 per cent to the closing price of each Existing Ordinary Share of 103.5 pence on 13 October 2016 (being the last practicable date prior to publication of this announcement). The Issue Price is the same as the price per new Ordinary Share recently issued under the Subscription.

As part of the Open Offer, the Excess Open Offer Entitlement facility will allow excess applications for Open Offer Shares over and above Qualifying Shareholders’ Open Offer Entitlements to be accepted from such holders to the extent that other Qualifying Shareholders do not take up their full Open Offer Entitlement.

As the allotment and issue of the Open Offer Shares will not exceed the Company’s existing authorities to allot shares for cash on a non pre-emptive basis, no general meeting of the Company is required to be convened to seek Shareholders’ approval to complete the Open Offer.

The Ordinary Shares to be issued pursuant to the Open Offer are to be admitted to trading on AIM, which is expected to take place at 8.00 a.m. on 1 November 2016. A further announcement will be made in due course.

Reasons for the Open Offer and use of proceeds

In May 2016, the Company announced that it had entered into the Metric Capital Finance Facility. This facility was conditional upon a future £25 million cash or capital injection to fund the development of a manufacturing base for the LIGHT system. In the light of the progress made in manufacturing its first LIGHT system and cementing its relationship with key manufacturing partners, the Company has decided to remove the uncertainty of this condition by carrying out the Subscription and implementing a financing plan supported by banks and strategic partners which should not be dilutive to equity investors. Metric Capital have confirmed that these arrangements would both obviate the requirement for the condition referred to above and trigger the drawdown of the £24m available under the Metric Capital Finance Facility.

The Directors are mindful of the support of existing Shareholders and have therefore decided to offer all Shareholders the opportunity to participate in the Open Offer at the same price as the Subscription.

The Company will use the net proceeds of the Open Offer to continue the development of the Company’s first LIGHT system which, once installed in Harley Street, will be the first Proton therapy centre in London. The funds will also support the Company’s advancing collaboration with manufacturing partner Thales, which aims to provide volume manufacturing capabilities initially targeted at producing eight LIGHT systems a year.

Directors’ intentions in relation to the Open Offer

The primary purpose of the Open Offer is to allow existing Shareholders (other than Directors) to subscribe for Ordinary Shares at the same price as the Subscription; therefore, in order to maximise the number of Open Offer Shares available to such existing Shareholders, the Directors have confirmed to the Company that they do not intend to participate in the Open Offer.

Posting of the Circular

A circular containing further details of the Open Offer is being posted to shareholders today. A copy of the circular will also be available on the Company’s website (www.advancedoncotherapy.com) from today.

Expected Timetable of Principal Events

2016

The dates set out in the Expected Timetable of Principal Events above and mentioned throughout this announcement may be adjusted by the Company in which event details of the new dates will be notified to AIM and, where appropriate, to Shareholders.

All references to time are to the time in London, England.

About Advanced Oncotherapy plc www.avoplc.com

Advanced Oncotherapy is a provider of particle therapy systems with protons that harnesses the best in modern technology. As a result, Advanced Oncotherapy will offer healthcare providers affordable systems that will enable them to treat cancer with an innovative technology providing better health outcomes and fewer treatment related side effects.

Advanced Oncotherapy’s team “ADAM” based in Geneva focuses on the development of a proprietary proton accelerator called Linac Image Guided Hadron Technology (“LIGHT”). LIGHT accelerates protons to the energy levels achieved in legacy machines but in a unit that is a fraction of the size and significantly lower in cost. This compact configuration delivers proton beams in a linear way that facilitates a greater precision and electronic control which is not achievable with older technologies.

The Company has signed two purchase agreements for the LIGHT proton therapy systems to be installed in hospitals in China. There are also four additional framework agreements and further Letters of Intent from other healthcare providers.

The Company has also signed a joint venture agreement with CircleHealth, owned by AIM-listed Circle Holdings plc, to operate the Company’s proton beam cancer therapy centre in Harley Street.

Advanced Oncotherapy continually monitors the market for any emerging improvements in delivering proton therapy and actively seeks working relationships with providers of these innovative technologies. Through these relationships, the Company will remain the prime provider of an innovative and cost-effective system for particle therapy with protons.

DEFINITIONS

Subscription & Proposed Open Offer

Advanced Oncotherapy (AIM: AVO), the developer of a next generation proton therapy system for cancer treatment, announces that it has successfully raised £10 million (before expenses) through the issue of 10,000,000 new ordinary shares of 25 pence each (the “New Shares”) in the capital of the Company at a price of 100p per New Share to new and existing shareholders (the “Subscription”).

The funds will be used to continue the development of the Company’s first LIGHT system which, once installed in Harley Street, will be the first Proton therapy centre in London. The funds will also support the Company’s advancing collaboration with manufacturing partner Thales, which aims to provide volume manufacturing capabilities initially targeted at producing eight LIGHT systems a year.

The Subscription will be subscribed for by a group led by senior management and Board members, MK Trust Co., Ltd and MK Investments Co., Ltd (together “MK Trust”), a Japanese financial institution focussing on Asian related investments.

The Company is mindful of the support of existing shareholders and is committed to allowing participation in an Open Offer with the same pricing as the Subscription. Details of the Open Offer will be announced over the next few weeks.

In May 2016, we announced that we had signed an agreement with a fund advised by Metric Capital Partners LLP (“Metric Capital”), a Pan-European private capital fund manager, to invest £24 million in a financing facility to support the Company’s provision of vendor financing for the installation of our first LIGHT machine in Harley Street. This facility was conditional upon a future £25 million cash or capital injection to fund the development of a manufacturing base for the LIGHT system. As announced earlier this morning, the Company has agreed with Metric to waive this condition and to make the full £24 million financing facility available for drawdown, subject to completion of the Subscription and the implementation of an additional financing plan supported by banks and strategic partners which will not be dilutive to equity investors. Further details of this financing plan are expected to be announced by the end of the year.

Director / PDMR Shareholding 

A group led by Directors and Senior Management will participate in the Subscription. Details of the Directors’ participation to the Subscription and their resultant shareholdings are provided below:

New significant shareholder

In addition, the Company welcomes the participation of a new major shareholder in the Subscription. MK Trust, a Japanese financial institution focussing on Asian related investments, has subscribed for 5,000,000 New Shares in the Subscription, which will represent 7.3% of the Company’s enlarged issued share capital on Admission.

MK Trust is owned by Chinese – Japanese entrepreneur and philanthropist Miky Kambara. Ms Kambara, owner and CEO of MK Trust, has helped Chinese buyers to acquire real estate properties in Japan with an aggregated value $14bn and has served as consultant for some of the top industrial companies in Japan.

Miky Kambara will become a senior advisor to Advanced Oncotherapy. She will be responsible for focussing on the Company’s business development in the Asian region and expanding the Company’s operations there, using her wealth of experience in this market. The Company, having already received purchase orders for two sites and signed exclusivity agreements with four other sites in China, expects this region to present a significant opportunity for future LIGHT system sales.

Lancea Partners and Green Rivers Investment Limited have advised the Company on the Subscription.

Admission

Application will be made for the New Shares to be admitted to trading on AIM (“Admission”) on 7 October 2016.

Following Admission, the Company’s enlarged issued share capital will comprise 68,780,361 ordinary shares, with voting rights. The Company does not hold any ordinary shares in treasury. Therefore the total number of ordinary shares in the Company with voting rights will be 68,780,361. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA’s Disclosure and Transparency Rules.

Michael Sinclair, CEO of Advanced Oncotherapy commented: “We have made tremendous progress in the development of the LIGHT system and as a result we have brought forward our plans to move to volume production with our manufacturing partner Thales. This funding will allow us to execute on these plans and deliver on our first installation in Harley Street and our readiness for full commercial roll-out.

“Given the huge opportunities that we see in the Asian market we are delighted to receive the support of MK Trust in this Subscription and we believe the contribution from Miky Kambara to our commercial plans for Asia will be highly valuable. As investors will have seen, my colleagues and I have seen this funding round as an opportunity to further commit significant resources to the Company. We are very keen to ensure that other existing shareholders have the same opportunity, and so we have committed to providing an Open Offer to investors under the same terms as the Subscription.”

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

Related party transactions

Michael Sinclair’s, Nicolas Serandour’s, Sanjeev Pandya’s and Michael Bradfield’s participations in the Subscription constitute a related party transaction under the AIM Rules for Companies.  In accordance, therefore, with the AIM Rules, the independent directors of the Company, having consulted with the Company’s nominated adviser, Stockdale Securities Limited, consider that the terms of Michael Sinclair’s, Nicolas Serandour’s, Sanjeev Pandya’s and Michael Bradfield’s participations in the Subscription are fair and reasonable insofar as the Company’s shareholders are concerned.

About Advanced Oncotherapy plc www.avoplc.com

Advanced Oncotherapy is a provider of particle therapy systems with protons that harnesses the best in modern technology. As a result, Advanced Oncotherapy will offer healthcare providers affordable systems that will enable them to treat cancer with an innovative technology providing better health outcomes and fewer treatment related side effects.

Advanced Oncotherapy’s team “ADAM” based in Geneva focuses on the development of a proprietary proton accelerator called Linac Image Guided Hadron Technology (“LIGHT”). LIGHT accelerates protons to the energy levels achieved in legacy machines but in a unit that is a fraction of the size and significantly lower in cost. This compact configuration delivers proton beams in a linear way that facilitates a greater precision and electronic control which is not achievable with older technologies.

The Company has signed two purchase agreements for the LIGHT proton therapy systems to be installed in hospitals in China. There are also four additional framework agreements and further Letters of Intent from other healthcare providers.

The Company has also signed a joint venture agreement with CircleHealth, owned by AIM-listed Circle Holdings plc, to operate the Company’s proton beam cancer therapy centre in Harley Street.

Advanced Oncotherapy continually monitors the market for any emerging improvements in delivering proton therapy and actively seeks working relationships with providers of these innovative technologies. Through these relationships, the Company will remain the prime provider of an innovative and cost-effective system for particle therapy with protons.