Norwood Immunology lists in UK at a premium

Norwood Immunology (AIM:NIM) commenced trading yesterday on London's Alternative Investment Market (AIM), with shares closing at 40.5 pence (AUD$1.046), a premium to their issue price of 38 pence.

Norwood Immunology sold 15.5 million new shares in the float, raising about AUD$15 million. A proportion of those shares were taken up by parent company Norwood Abbey [ASX:NAL, NASDAQ:NABYF], which converted debt into Norwood Immunology equity.

Following its listing, Norwood Immunology's market capitalisation is about AUD$125 million, significantly below the pre-money target valuation of £100 million (AUD$263 million) originally given by advisers KBC Peel Hunt. Norwood Abbey's 83 per cent holding has a market value of AUD$100 million at yesterday's closing price.

"We were thinking that we would get 70 to 75 per cent, so we're very pleased with this outcome," said Bernie Romanin, Norwood Abbey's director of marketing and investor relations.

Romanin acknowledged that the company had found the London market difficult. "We were very pleased to get the listing away at the level that it did," he said. "[UK] public listings have been somewhat different to expectation. Our priority was to get the listing so we could accelerate some of the clinical programs."

Romanin said that the AUD$15 million raised would be enough to initiate Norwood Immunology's key programs and to drive the program for at least 12 to 18 months. "We couldn't say that this will be the last capital raising," he said.

Norwood Immunology was established to commercialise the discovery by Monash scientist Prof Richard Boyd that gonadotrophin releasing hormone (GnRH) can 'reboot' the immune system by regenerating the thymus gland.

The therapeutic potential of reinvigorated the thymus is already being trialled at Melbourne's Alfred Hospital and the Peter MacCallum Cancer Institute in patients undergoing bone marrow transplants.

Preliminary trial results showing evidence of thymic regrowth, and increased thymic output of naïve, regulatory T cells and CD4 helper T cells, were presented at the American Society of Haematology conference last December. The final analysis and reporting of these studies is due in mid-2005.

Last year, Norwood also signed a major agreement with TAP Pharmaceutical Products -- the US Market leader in GnRH drugs with Lupron Depot -- to commercialise the use of the drugs for this purpose.

Meanwhile, Norwood Abbey has raised AUD$10.1 million through the exercise of options expiring on 30 June, bringing the total cash held by the company to over $20 million. Chairman Peter Hansen made available some of the options he held to three institutional investors from Australia and the US.