June 29--Medigus Ltd. (TASE:MDGS), which develops minimally invasive endosurgical tools and procedures, announced today the signing of private equity placement agreement for $11.1 million including shares and warrants. Roughly half of the amount will be raised from leading Israeli investors, led by entities from Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL), with the remainder from US institutional investors Sabby Management, Armistice Capital and Senvest. Returning investors include Orbimed, Medigus' controlling shareholder. As part of the transactions, Medigus has granted registration rights to the investors via the completion of an ADR trading program or TASE release prospectus within seven months of the closing of the investment.
After the investment was announced, the company's share price jumped 12.5% to NIS 51.40.
Medigus CEO Chris Rowland said "We are pleased to announce the signing of these investments with leading institutional investors from Israel and the US, including funds that specialize in healthcare. These investments reflect the confidence of investors in our strategy and vision. Increasing our capital base will support our strategic plan of expanding the use of our MUSE system, and will enhance our position as a leader in the minimally invasive endosurgical market, with the ultimate goal of enhancing shareholder value."
Medigus chairman and Orbimed Israel Senior Managing Director Dr. Nissim Darvish said, "We are confident that Medigus' management will lead the company to a successful execution of its strategic plan and growth in the coming years."
The proceeds will be used for working capital and general corporate purposes. Medigus anticipates initial revenues from the MUSE system in 2014.
ROTH Capital Partners, LLC and Ladenburg Thalmann & Co. Inc. are serving as co-exclusive placement agents on the transaction. The closing of the investments are subject to shareholder approval, anticipated within the next 45 days.
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