BioLight Life Sciences Ltd (TA:BOLT) is engaging in a shareholder rights offering of up to NIS12m (if fully subscribed) to strengthen its balance sheet. While BioLight had NIS20.2m net cash at Q117, most was held at subsidiaries, and only NIS4.7m was directly available to the parent firm; hence the imminent funding need. The four largest shareholders (representing 55%) will participate to some degree in the rights offering. If fully subscribed, we estimate the rights offering can provide funding into at least Q417. Our model, which does not yet include the rights offering or the potential IOPtima sale to a Chinese investor, derives an rNPV valuation of NIS92.9-103.4m.
Continuing to work towards completing IOPtima sale
In April 2017, BioLight’s IOPtima subsidiary (of which BioLight holds a 70% ownership stake) signed a non-binding term sheet, calling for it to be sold to Chengdu Kanghong Pharma. Chengdu had a 60-day exclusivity clause restricting IOPtima from entering potential sale discussions with other prospective buyers. While this window should expire imminently (mid-June 2017), BioLight management remains involved with ongoing discussions to finalise a sale transaction with Chengdu, and suggests the expiry of the exclusivity period should not diminish the likelihood of the completion or finalisation of the Chengdu deal.
To read the entire report Please click on the pdf File Below