SOURCE: Living Cell Technologies

October 04, 2007 08:30 ET

Living Cell Technologies to Receive A$2.4 Million in Financing

Investment Group May Provide LCT With Additional Financing

MELBOURNE, AUSTRALIA and AUCKLAND, NEW ZEALAND--(Marketwire - October 4, 2007) - Living Cell Technologies Limited (ASX: LCT) (PINKSHEETS: LVCLY) today signed a non-binding letter of intent for the purchase of A$2.4 million in ordinary shares by a U.S.-based investment group, NaviGroup Management Ltd.

The private placement will consist of an initial A$2.4 million to close within thirty days of the execution of the letter, subject to the satisfactory completion of due diligence by the investor. The placement will be made within the amount of shares available under ASX listing rule 7.1*.

The non-binding letter of intent provides for a 90-day period for one or more additional placements to occur following this initial amount, up to an aggregate amount of A$7.4 million, for a total potential financing of A$9.8 million.

The initial closing will represent a total of approximately 22.4 million shares with an issue price of $0.11, based on 80% of the last 30-day average trading price. Subsequent closings will be priced at the lower of A$0.20, or 80% of the 30-day average closing bid price per ordinary share of the Company as quoted on the ASX. Additional placements will be subject to shareholder approval pursuant to applicable ASX rules.

NaviGroup Management represents an international group of sophisticated investors. NaviGroup Management will be entitled to appoint a director to the Board of Directors of LCT. Each additional placement will enable NaviGroup to appoint an additional director to Living Cell's Board of Directors, up to a maximum of three directors. Any directors to be appointed by NaviGroup are to have international experience in funding and finance.

"We are pleased to receive support from an international investor such as NaviGroup," stated Dr. Paul Tan, Chief Executive Officer. "This transaction broadens our shareholder base and demonstrates confidence in DiabeCell's clinical development and potential as a treatment for type 1 diabetes."

The funds will be used as working capital to further LCT's DiabeCell® clinical trials in Russia and New Zealand, as well as ongoing expansion of the pig breeding herd to meet clinical requirements.

This is a direct placement with Navigroup's investors and will not be subject to brokerage fees. Following the initial funding of A$2.4 million, the definitive agreements will not prohibit LCT from assessing further long-term funding opportunities.

About Living Cell Technologies:

Living Cell is developing live cell therapy products to treat life threatening human diseases. The Company owns a biocertified pig herd that it uses as a source of cells for treating diabetes and neurological disorders. For patients with type 1 diabetes, the company transplants microencapsulated islet cells so that near-normal blood glucose levels may be achieved without the need for administration of insulin or at significantly reduced levels. The company entered clinical trials for its diabetes product in 2007. For the treatment of Huntington's disease and other neurological disorders, the company transplants microencapsulated choroid plexus cells that deliver beneficial proteins and neurotrophic factors to the brain. Living Cell also offers medical-grade porcine-derived products for the repair and replacement of damaged tissues, as well as for research and other purposes.

*Background Information:

ASX Listing Rule 7.1 provides that a company, must not, subject to specified exceptions, issue or agree to issue during any 12 month period any equity securities, or other securities with rights to conversion to equity (such as an option), if the number of those securities exceeds 15% of the number of securities in the same class on issue at the commencement of that 12 month period.

LCT Disclaimer

This document contains certain forward-looking statements, relating to LCT's business, which can be identified by the use of forward-looking terminology, or by express or implied discussions regarding potential filings or marketing approvals, or potential future sales of product candidates. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. In particular, management's expectations regarding the approval and commercialization of product candidates could be affected by, among other things, unexpected clinical trial results; unexpected regulatory actions or delays, or government regulation generally; our ability to obtain or maintain patent or other proprietary intellectual property protection; competition in general; government, industry, and general public pricing pressures; and additional factors that involve significant risks and uncertainties about our products, product candidates, financial results and business prospects.

Contact Information

  • Further information:

    Richard Justice
    Chief Financial Officer
    Tel: +64-9-276-2690 (x. 739)
    Mobile: +64-21-223-4741

    Dr. Paul Tan
    Chief Executive Officer
    Tel: +64-9-270-7941
    Mobile: +61-402-716-984

    Rachel Levine
    Investor and Media Relations
    Tel: +646-284-9439