Immuron to issue $4.1m worth of options

Immuron (ASX:IMC) will this month issue around $4.1 million worth of bonus options to existing shareholders.

The company plans up to 103.5 million options, or one for every four shares held by investors, at an exercise price of $0.04 per share. If each of the bonus options are exercised in full, Immuron would raise $4.1 million.

As of 2pm on Monday, Immuron shares were trading at $0.021, just over half of the exercise price for the options. In May, Immuron chairman Professor Colin Chapman asserted that the company's recent share price is not reflective of the commercial progress the company has made.

Any proceeds raised from the options will be put towards commercialising the company's product pipeline, meeting R&D costs and funding general working capital.

Immuron's product pipeline includes Travelan, an OTC preventative treatment for travellers' diarrhoea, which has so far been licensed to pharmaceutical companies Paladin Labs, IntegraMed Asia and Ziwell Medical.

The company is also developing a potential treatment for nonalcoholic steatopatitis (NASH) and fatty liver disease, and an OTC influenza inhibitor,

The offer prospectus, dispatched to shareholders today, advises that the company will need to raise additional capital over the next three years regardless of how many options are exercised.

The option issue is intended to ensure existing shareholders have the ability to maintain their percentage interest in the company following any share placements to new investors.

Immuron's last capital raising, a share purchase plan, closed more than 50% undersubscribed. The offer was being underwritten by Paterson Securities, but the firm terminated the underwriting blaming market conditions.