Inside information: Bioretec Ltd launches an accelerated book-building process to raise approximately EUR 5 million through a private placement of new shares

THE INFORMATION CONTAINED IN THIS RELEASE IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, HONG KONG, JAPAN, SINGAPORE, SOUTH AFRICA OR THE UNITED STATES OR IN ANY OTHER JURISDICTION IN WHICH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

Bioretec Ltd ("Bioretec" or the "Company"), a pioneer in biodegradable orthopedic implants, hereby announces its intention to issue new shares (the "Placing Shares") in a private placement to institutional and other qualified investors (the "Placing") to raise approximately EUR 5 million in gross proceeds.

The number of Placing Shares and their subscription price will be decided based on offers received in an accelerated book building. Danske Bank A/S, Finland Branch ("Danske Bank") is acting as the sole book-runner of the Placing. The result of the Placing will be published as a company announcement after the completion of the book building. The book building will be launched immediately following the publication of this company announcement. The book-building can be discontinued or extended at any time during the book-building process.

The purpose of the contemplated Placing is to raise funds to strengthen the commercialization of RemeOs™ Trauma Screws in the US and in Europe upon the receipt of market authorization in Europe and to accelerate the product development of the RemeOs™ Spinal Interbody Cage following the Breakthrough Device Designation status granted by the US Food and Drug Administration (the FDA) on 14 March 2024 by initiating the preclinical large animal trial at the end of the year 2024.

The Placing will be carried out based on the authorization granted to the board of directors by the Company's annual general meeting of 26 April 2024.

Subject to the completion of the Placing, the Placing Shares (ISIN code FI4000480454) will be registered with the trade register maintained by the Finnish Patent and Registration Office on or about 28 November 2024. The Placing Shares are expected to be ready for delivery to the investors against payment through Euroclear Finland Oy on or about 2 December 2024. Trading in the Placing Shares is expected to commence on Nasdaq First North Growth Market Finland on or about 2 December 2024.

The Company intends to enter into customary lock-up undertaking for a period of 180 days in connection with and subject to completion of the Placing.

The Company estimates that considering its current business plan and the targeted size of the Placing, the gross proceeds raised in the Placing will be sufficient for approximately 8 months. In order to reach positive cash flow from operating activities by the end of the year 2027, in accordance with the current business plan, the Company estimates that it will require approximately EUR 18 million in total external funding. Any licensing income or milestones achieved by the Company during the upcoming commercialization stages will have an effect on the estimate above.

In preparing for the Placing, the board of directors of the Company has made an overall assessment and considered various capital raising alternatives, including the possibility to raise capital through a rights issue. After careful consideration, the board of directors has determined that a directed share issue by way of the Placing in deviation from the shareholders' pre-emptive rights is a better alternative for the Company's shareholders than a rights issue. A rights issue would entail a significantly longer execution time and thereby increased market exposure and a higher potential risk of affecting the share price negatively, particularly in a volatile and challenging market, compared to a directed share issue. The cost of carrying out a directed share issue is deemed to be lower than in a rights issue where, among other things, there would be a risk that a rights issue would not be fully subscribed and significant underwriting commitments from an underwriting syndicate would possibly have to be procured. Further, the board of directors has a positive view on an increased shareholding in the Company among institutional investors and other qualified investors because of their nature as long-term investors, who are able to offer substantial capital investments cost-effectively. Consequently, and taking into account the Company's plan to speed-up the commercialization of RemeOs™ Trauma Screw products, product development strategy and the accelerated timeline for the development of the RemeOs™ Spinal Interbody Cage, when comparing a potential rights issue and a directed share issue and their respective implications on costs and timelines for the commercialization of the products and product development strategy, the board of directors views that the Placing allows the Company to obtain financing on terms and in a timetable that will be more beneficial than terms that would otherwise be available, and therefore weighty financial reasons exist for deviating from the pre-emptive rights of the shareholders.

By determining the subscription price in the Placing through an accelerated book building, it is the assessment of the board of directors that the subscription price will be set on market terms.

Danske Bank is acting as the sole bookrunner of the Placing. Krogerus Attorneys Ltd is acting as the legal counsel to the Company and Borenius Attorneys Ltd is acting as the legal counsel to the sole bookrunner.

Bioretec Ltd
Board of directors

Further enquiries

Alan Donze, CEO, +1 619 977 5285
Tomi Numminen, Chairman of the Board, +358 40 581 2132

Certified adviser

Nordic Certified Adviser AB, +46 70 551 67 29

Information about Bioretec

Bioretec is a globally operating Finnish medical device company that continues to pioneer the application of biodegradable orthopedic implants. The company has built unique competencies in the biological interface of active implants to enhance bone growth and accelerate fracture healing after orthopedic surgery. The products developed and manufactured by Bioretec are used worldwide in approximately 40 countries. 

Bioretec is developing the new RemeOs™ product line based on a magnesium alloy and hybrid composite, introducing a new generation of strong biodegradable materials for enhanced surgical outcomes. The RemeOs™ implants are absorbed and replaced by bone, which eliminates the need for removal surgery while facilitating fracture healing. The combination has the potential to make titanium implants redundant and help clinics reach their Value-Based Healthcare targets while focusing on value for patients through efficient healthcare. The first RemeOs™ product market authorization has been received in the U.S. in March 2023, and in Europe, the CE mark approval process is currently ongoing. Bioretec is positioning itself to enter the addressable over USD 9 billion global orthopedic trauma and spine market and to become a game changer in surgical bone fracture treatment.

Better healing - Better life. www.bioretec.com

Forward-looking statements

This company release includes forward-looking statements which are not historical facts but statements regarding future expectations instead. These forward-looking statements include without limitation, those regarding Bioretec's future financial position and results of operations, the Company's strategy, objectives, future developments in the markets in which the company participates or is seeking to participate or anticipated regulatory changes in the markets in which the company operates or intends to operate. In some cases, forward-looking statements can be identified by terminology such as "aim," "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "guidance," "intend," "may," "plan," "potential," "predict," "projected," "should" or "will" or the negative of such terms or other comparable terminology.

By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance and are based on numerous assumptions. The Company's actual results of operations, including the Company's financial condition and liquidity and the development of the industry in which the Company operates, may differ materially from (and be more negative than) those made in, or suggested by, the forward-looking statements contained in this company release.

Important notice

The distribution of this release may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restrictions. The information contained herein is not for publication or distribution, directly or indirectly, in or into Australia, Canada, Hong Kong, Japan, Singapore, South Africa or the United States or in any other jurisdiction in which publishing or distributing would be prohibited by applicable law. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. This release is not directed to, and is not intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction.

This release does not constitute a prospectus as defined in the Prospectus Regulation ((EU) 2017/1129, the "Prospectus Regulation") and as such, does not constitute or form part of and should not be construed as, an offer to sell, or the solicitation or invitation of any offer to buy, acquire or subscribe for, any securities or an inducement to enter into investment activity.

This release is directed only to (A) persons who are outside the United States of America; (B) persons who are resident in a Member State of the European Economic Area and are a qualified investor (within the meaning of Article 2(1)(e) of the Prospectus Regulation)); and (C) as regards the United Kingdom, persons who are "Qualified Investors" within the meaning of Article 2(1)(e) of the Prospectus Regulation as it forms part of English law by virtue of the European Union (Withdrawal) Act 2018, who are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); (ii) high net worth entities; and (iii) and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as "Relevant Persons"). Any securities mentioned herein are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, Relevant Persons. No one who is not a Relevant Person shall act on the basis of this release.

The securities referred to in this release have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), or under the securities laws of any state of the United States, and may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States absent registration except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act. Subject to certain limited exceptions, the securities referred to in this release are being offered and sold only outside the United States.

Danske Bank acts only for and on behalf of the Company in connection with the Placing. Danske Bank does not hold any other party as their client or cannot be held accountable to advise other parties than the Company with regards to the Placing or other matters referred hereto.

Information to Distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, distributors should note that: the price of the  Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to any offering of the Placing Shares. Furthermore, it is noted that, notwithstanding the Target Market Assessment, Danske Bank as the sole bookrunner, will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.