Eiffel to raise $3 million

Shares in Sydney drug re-engineering company Eiffel Technologies (ASX: EIF) slumped today when the company announced a capital raising of AUD$3.0 million, placing 36.4 million fully paid ordinary shares at 8.25 cents per share.

A proportion of the placement will be subject to approval at an extraordinary general meeting. The balance, of approximately 14 per cent of the company's capital, will be issued immediately. The placement was supported by existing shareholders and new institutional investors.

In a statement, the company said it plans to use the funds for manufacturing, screening of further re-engineered drugs, pre-clinical studies and patent applications. It will also explore the potential to acquire additional re-engineering technology platforms and complementary drug delivery technologies.

Shares were down 10 per cent to 8.8 cents at time of writing.