After share price triples, Pluristem to raise $40-50m
Jan 27, 2011 (Globes - McClatchy-Tribune Information Services via COMTEX) -- Stem cell therapy developer Pluristem Therapeutics Ltd. (Nasdaq:PSTI; TASE: PLTR; DAX: PJT) is planning a secondary offering of shares and warrants on Wall Street, following a 193 percent rise in its share price in the three weeks since the start of 2011. The offering is based on its draft prospectus filed with the US Securities and Exchange Commission (SEC).
The company did not disclose how much it plans to raise, but sources inform "Globes" that the figure is $40-50 million.
Last week, Pluristem obtained joint US Food and Drug Administration (FDA) and European Medicines Agency (EMEA) approval for two clinical trials for its placenta-derived cell therapy, PLX-PAD, for blocked arteries in the limbs and heart: and a Phase II/III study for critical limb ischemia (CLI) or severe blockage in the arteries; and a Phase II study for ischemia colitis (IC), or inflammation and injury of the large intestine result from inadequate blood supply. The approval of the Phase II/III study for critical limb ischemia means that the company can leapfrog a Phase II clinical trial, and it may be able to market the treatment after just one multi-center trial, assuming it is a success.
Pluristem's share price has been climbing relentlessly in the past few days. Yesterday's announcement, however, sent the share price down 8.1 percent in after-hours trading on Nasdaq, after rising 5.6 percent during the session to $4.20, giving a market cap of $110 million. Investors apparently expect their holdings to be diluted in the offering. The share price rose 1 percent on the TASE this morning, before trading in the share was suspended ahead of the pricing for the offering.
Pluristem's share price has been rising ever since it received a warm recommendation from Ray Dirks. He predicts that the company will achieve a return of 262 percent a year, and he set a target price $17, more than for times the current share price.
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Gali Weinreb
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