Synairgen Shares Plunge as Company Conditionally Raises £18m

Shares in Synairgen (LSE: SNG) tumbled over 39% Friday after the drug developer announced a heavily discounted fundraising to raise a minimum of £18 million.

The fundraising involves the issuance of 900 million new ordinary shares at 2 pence each, a sharp discount to Thursday's close of 3.75p.

TFG Asset Management UK will subscribe to the majority of the shares, securing the £18 million conditional raise.

The proceeds will fund a Phase 2 trial of Synairgen's investigational drug, SNG001, targeting patients on mechanical ventilation due to severe respiratory viral infections.

Synairgen has also launched an open offer and placing to raise an additional £6 million, enabling existing shareholders to participate.

However, the fundraising requires a minimum subscription of £2.9 million to proceed.

The company said that in the event that the minimum fundraising condition is satisfied, the maximum amount to be conditionally raised by the company will be capped at £19 million.

The proceeds will be used to fund external and internal costs of a Phase 2 trial of SNG001 in mechanically ventilated patients with confirmed respiratory viral infections, drug manufacturing and stability testing.

“We are delighted to have secured a path forward for SNG001,” said Richard Marsden, CEO of Synairgen. “We are grateful for the support from TFG Asset Management UK and the ongoing support of our shareholders as we now look forward to initiating this important trial in 2025.”

The move comes with a waiver under Rule 9 of the Takeover Code, as TFG Asset Management UK's stake will exceed 30% of Synairgen's voting share capital post-raise, subject to shareholder approval.