Capital/Financing Update • Oct 20, 2011
Capital/Financing Update
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Corporate | 20 October 2011 19:21
Cytos Biotechnology Ltd announces Q3 Financial Results and convenes a Bondholders’ meeting to secure a going concern
Cytos Biotechnology AG / Key word(s): Capital Reorganisation
20.10.2011 / 19:21
– Cash burn in line with expectations
– Production of material to enable Phase IIb studies with CYT003-QbG10 on-going
– Progress made on strategic options review
– Bond restructuring proposal allows the bondholders to recover up to 100% of the convertible bonds and significantly improves the bondholders' prospect to participate in the equity upside potential
– Going concern of Cytos Biotechnology Ltd and preservation of the value of its key asset CYT003-QbG10 are highly dependent on a successful convertible bonds restructuring
Schlieren (Zurich), Switzerland, October 20, 2011 – Cytos Biotechnology Ltd (SIX: 'CYTN'; the 'Company'; 'Cytos') today presented its third quarter financial results as well as its proposed financial restructuring of the outstanding convertible bonds and convenes a bondholders' meeting on November 10, 2011 in Schlieren/Switzerland.
Key Financial Results:
– Cash, cash equivalents, financial assets and trade receivables amount to CHF 33.7 million as per September 30, 2011
– The outstanding nominal value of the convertible bonds amounts to CHF 38.8 million as per September 30, 2011
– Gross cash used in operations was CHF 1.7 million on average per month for the first nine months of 2011
– Revenues of CHF 1.3 million, Net Loss of CHF 16.1 million for the first nine months of 2011
The detailed Q3 Financial Report can be downloaded at http://www.cytos.com/userfiles/file/Cytos_Q3_2011_E.pdf
Progress on strategic options to date:
Assisted by an internationally renowned advisor, Cytos considered in the past months all its strategic options which also determined the timing of the announcement and the implementation of its restructuring measures announced on August 17, 2011. During this process, the Company recognized that the likelihood of realizing a solution which includes the full redemption of the convertible bonds can be substantially increased with additional time gained by a financial restructuring of the convertible bonds including a partial repayment at maturity in February 2012 as well as an extension of the remainder.
Key Considerations:
– According to present financial plans and taking into consideration the implication from the recently announced restructuring the financing gap at maturity of the convertible bonds in February 2012 amounts to around CHF 17 million.
– Access to new financial means for a small biotech company without sustainable revenues remains very challenging in the current financial market environment.
– With the planned restructuring of its convertible bonds, liquidity of Cytos shall be secured to continue operations.
Key elements of the proposed convertible bonds restructuring:
– Cash payout of 50% nominal per outstanding convertible bond on February 20, 2012
– Extension of the maturity of the remaining 50% nominal of outstanding convertible bonds for three years
– Doubling of the coupon and suspension of interest payments
– More than twenty-fold reduction of the conversion price, i.e. from CHF 175 to CHF CHF 8.21
– Amendment of bond assurances
A successful financial restructuring of the CHF 70 million convertible bonds maturing on February 20, 2012 is essential for the Company to remain going concern and to facilitate a potential value maximization of Cytos' lead product CYT003-QbG10.
In order to formalize the restructuring, a bondholders' meeting is scheduled to take place on November 10, 2011 in Schlieren/Switzerland.
The notice to the bondholders as well as the detailed content of the financial restructuring of the outstanding convertible bonds can be downloaded at www.cytos.com/bondrestructuring
The elements of the convertible bonds restructuring have been elaborated carefully together with Cytos' financial advisor, Neue Helvetische Bank, and represent, in the view of the Board of Directors and the management, a fair and reasonable proposal which serves to sustain operations of Cytos, thereby gaining the additional time needed to focus on its key asset CYT003-QbG10 and to further explore strategic options.
The Board of Directors and the Management strongly support approving the financial restructuring which is in the best interest of bondholders, shareholders, and other stakeholders and will do its utmost to realize a solution that enables Cytos to fully repay the extended convertible bonds. In addition, value creating measures with CYT003-QbG10 and efforts on strategic options will further be pursued. The proposed restructuring will not need shareholders approval.
For further information please contact:
Cytos Biotechnology Ltd
Harry Welten
Chief Financial Officer
Tel.: +41 44 733 46 46
e-Mail: [email protected]
Website: www.cytos.com
About Cytos Biotechnology Ltd
Cytos Biotechnology Ltd is a Swiss public biotechnology company that specializes in the discovery, development and commercialization of a new class of biopharmaceutical products – the Immunodrugs(TM). Immunodrugs(TM) are intended for use in the treatment and prevention of common chronic diseases, which afflict millions of people worldwide. Immunodrugs(TM) are designed to instruct the patient's immune system to produce desired therapeutic antibody or T cell responses that modulate chronic disease processes. The Immunodrug(TM) candidates are developed both in-house and together with Novartis, Pfizer and Pfizer Animal Health. Founded in 1995 as a spinoff from the Swiss Federal Institute of Technology (ETH) in Zurich, the Company is located in Schlieren (Zurich). Cytos Biotechnology Ltd is listed on the main segment at the SIX Swiss Exchange (SIX:'CYTN').
This foregoing press release may contain forward-looking statements that include words or phrases such as 'are intended for', 'are designed to', 'could be', 'will' or other similar expressions. These forward-looking statements are subject to a variety of significant uncertainties, including scientific, business, economic and financial factors, and therefore actual results may differ significantly from those presented. There can be no assurance that any further therapeutic entities will enter clinical trials, that clinical trial results will be predictive for future results, that therapeutic entities will be the subject of filings for regulatory approval, that any drug candidates will receive marketing approval from the U.S. Food and Drug Administration or equivalent regulatory authorities, or that drugs will be marketed successfully. Against the background of these uncertainties readers should not rely on forward-looking statements. The company assumes no responsibility to update forward-looking statements or adapt them to future events or developments. This document does not constitute an offer or invitation to subscribe or purchase any securities of Cytos Biotechnology Ltd.
End of Corporate News
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| Language: | English |
| Company: | Cytos Biotechnology AG |
| Wagistr. 25 | |
| 8952 Schlieren | |
| Switzerland | |
| Phone: | +41 44 733 4747 |
| Fax: | +41 44 733 4740 |
| E-mail: | [email protected] |
| Internet: | www.cytos.com |
| ISIN: | CH0011025217, CH0029060735 |
| Swiss Security Number: | – |
| Listed: | Regulierter Markt in SIX; Freiverkehr in Berlin, München, Stuttgart; Open Market in Frankfurt |
| End of News | EquityStory AG News-Service |
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| 142979 20.10.2011 |
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