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Benitec Raises $8.5M in Oversubscribed Rights Issue

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Benitec said this week that its previously announced A$8 million ($8.5 million) renounceable rights issue has successfully closed oversubscribed.

“The offer was four new shares for every five fully paid ordinary shares held, plus one new free listed option for every four new shares issued, resulting in the issue of 404,565,897 new shares and 101,141,474 new listed options with an exercise price of AU$0.04,” the company said. “A further 100,160,982 options, with the same terms … will be issued to the sub-underwriters of the issue.”

Rights issue acceptances were received for 302,716,126 shares, with the shortfall applications from existing shareholders causing the remainder of the issue to be oversubscribed, it added.

“Demand for Benitec stock through the rights issue has been exceptionally strong, resulting in demand outstripping supply,” Benitec Chairman Peter Francis said in a statement. “Not only was there a very high proportion of entitlements taken up, but a significant percentage of shareholders applied for shares in excess of their entitlement.”

The financing comes at a critical time for Benitec, which is working to turn itself around after a years-long fight over its core US patent. After claims in the patent were repeatedly invalidated during a re-examination process at the US Patent and Trademark Office, earlier this year the agency confirmed the patentability of all the claims (GSN 2/27/2011).

With the cornerstone of its intellectual property portfolio upheld, the company set its sights on fundraising a few months later, hoping to raise enough money to support its three drug-development programs (GSN 4/14/2011).

"Together with the favorable ruling by the US Patent and Trademark Office late last year, and other favorable decisions since, including in Europe, this [financing] enables the relaunch of Benitec,” CEO Peter French said in a statement.

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