Cardiex Faces Shareholder Vote on $736K Placement Amid Expansion Plans

Capital Raise Overview

Cardiex Limited (ASX – CDX), a player in the medical devices sector focused on vascular health, has completed a significant institutional placement, raising $2.4 million before costs. The company issued over 60.9 million new fully paid ordinary shares at an offer price of $0.04 per share. This capital injection is designed to support the next phase of growth for Cardiex’s flagship product, the CONNEQT Pulse device.

Investor Support and Shareholder Participation

The placement attracted strong backing from both existing institutional shareholders and new sophisticated investors. Notably, C2 Ventures Pty Limited, the company’s largest shareholder controlled by directors Craig Cooper and Niall Cairns, committed to subscribing for $736,383.20 worth of shares. However, the issuance of shares to C2 Ventures is contingent upon shareholder approval at the upcoming general meeting, anticipated in late July. This introduces a degree of uncertainty regarding the final allocation.

Use of Funds and Strategic Focus

Cardiex plans to deploy the funds primarily towards ramping up manufacturing capabilities, enhancing marketing and sales efforts, and expanding commercial operations. A key focus is scaling the supply chain for the CONNEQT Pulse device, which leverages the company’s proprietary SphygmoCor® vascular biomarker technology. This device aims to address hypertension and cardiovascular disease, positioning Cardiex in a growing healthcare niche.

Share Issuance and Regulatory Compliance

Of the total shares issued, 42.5 million will be allocated under Cardiex’s existing placement capacity as per ASX Listing Rule 7.1, allowing for a streamlined issuance process. The remaining 18.4 million shares intended for C2 Ventures will require shareholder approval and thus fall outside this capacity. All new shares will rank equally with existing ordinary shares from the date of issue, maintaining shareholder parity.

Advisors and Fees

The placement was managed by a trio of Joint Lead Managers – Blackpeak Capital Pty Ltd, Stralis Capital Partners Limited, and Taylor Collison Limited. They will receive a management fee of 4% and a selling fee of 2% on the placement proceeds, with the selling fee excluding proceeds from C2 Ventures and any directors’ participation. This fee structure aligns incentives to successfully complete the capital raise while managing costs.

Overall, this capital raise marks a pivotal step for Cardiex as it seeks to commercialize its innovative vascular health technology more aggressively. The company’s ability to execute on manufacturing and market expansion will be critical in the coming months.