Israel's Pluristem Gets $30M Chinese Funds (PSTI)
Oct. 26 2016
Pluristem Therapeutics Inc. (PSTI) stock spiked 8% on Nasdaq October 25 after the Israeli biotech firm said it will receive a $30 million investment from Innovative Medical Management Co., an affiliate of Chinese venture capital firm, Zheshang Venture Capital.
Both Innovative Medical Management and Zheshang Venture Capital are publicly-listed companies in China.
Chinese Firm Gets 17% Stake in Pluristem
Under the deal, Innovative Medical will acquire a 17% stake in Pluristem in exchange for 16.9 million common shares at $1.77 per share. Before the deal was announced, Pluristem's stock price was $1.52 per share.
Pluristem closed October 25 at $1.64 per share, up 12 cents from the day before, on unusually high volume of 701,060 shares. Average daily trading volume is 143,723.
Innovative Medical will also get additional 4.4 million warrants to buy Pluristem common shares at an exercise price of $2.50 per warrant. The warrants are exercisable for 5 years.
Under the transaction, Innovative Medical will get a seat on Pluristem's board of directors, as long as Innovative holds at least 12.5% of Pluristem’s issued and outstanding stock. Innovative Medical also gets certain rights to potential Pluristem deals in China.
Pluristem will use the cash infusion to support late-stage trials for its cell therapies. Pluristem, based in Haifa, Israel, develops placenta-based cell therapy products. (See also: Amgen's Venture Funding Initiative.)
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