Bioniche to raise $10m through equity offer

Bioniche (ASX:BNC) aims to raise up to C$9.8 million ($10.1 million) through an equity offering to Canadian investors.

The dual-listed biopharmaceutical company has issued a prospectus for a public offering worth up to C$9 million. The offer is open to investors from most provinces of Canada.

Bioniche is offering units for C$0.29 apiece. This price will buy one share and half of a warrant exercisable at C$0.40 for two years.

A further $804,500 will be raised through a private placement under the same terms.

Bioniche plans to use the proceeds to ensure it is well funded during the divestment of its animal health unit, in order to continue development of its phase III bladder cancer product Urocidin.

In May, Bioniche announced plans to sell off its animal health division to concentrate its resources on Urocidin development. Bioniche had been licensing Urocidin to Endo Pharmaceuticals, but in April the companies wound up their agreement and Bioniche took back the rights.

On the divestment, Bioniche said the firm it has appointed to lead the process, Evercore Partners, has identified a short list of possible buyers. These companies are currently conducting due diligence on a potential deal.

But Bioniche no longer expects to be able to present details of a potential sale at its annual general meeting in November and instead now plans to call a separate meeting to vote on the deal. The sale is expected to be complete by early calendar 2014.

Bioniche revealed last week that it had settled a dispute with disgruntled shareholders seeking to block the animal health sale and that CEO Graeme McRae will be moving into a consulting role once a replacement is found.

Bioniche (ASX:BNC) shares were trading unchanged at $0.38 as of around 1.30 pm on Friday.