REVA Medical gets major new investors

Shares in medical device company REVA Medical grew more than 16% on Monday, after the company revealed it has gained some major new institutional investors.

The buyers, including US hedge fund Elliott Management, have purchased CHESS Depository Interests (CDIs) and shares from existing REVA Medical shareholders.

Elliott Management has become a substantial shareholder as a result of the deal. The other participants, including medical device maker Medtronic, already owned REVA Medical shares.

The deal was negotiated privately with existing REVA Medical shareholders, and was worth a total of US$24 million ($22.6 million).

The arrangement was brokered by US-based boutique investment bank MM Dillon. The buyers agreed to pay $0.50 per CDI, which is equivalent to $5.00 per common share.

REVA Medical is based in Delaware in the US, but is listed exclusively on the ASX. In December last year, the company commenced clinical trials of its lead product, the ReZolve sirolimus-eluting bioresorbable coronary stent.

The first patient in this clinical trial was implanted with the stent in December 2011. The multi-centre study is expected to involve 50 patients. Data is due to be published in May.

REVA Medical (ASX:RVA) CDIs listed on the ASX climbed 16.67% in Monday's trading to $0.665 after the deal was made public. This represents the highest trading price since September last year.