The major shareholders in cancer drug company BioCanCell Therapeutics Ltd. (TASE:BICL) - Clal Biotechnology Industries Ltd. (TASE: CBI) (44%), the Edgewater Partner Holdings fund (20%), and the Palisade Capital Management fund (19%) - have revised their offer to purchase for the 11% of the company's shares owned by the public. The new offer is at a price of NIS 1.70 per share, which compares with NIS 1.40 per share in the previous offer in early November, a 21% increase. BioCanCell's shares responded to the news today by jumping 13.6% to NIS 1.67, giving a NIS 141 million market cap. Since discussion of an offer to purchase in BioCanCell began in October, the company's share price has soared 90%. The minority holdings in BioCanCell are dispersed among the public, with no substantial holdings by investment institutions, so that the main challenge in the offer to purchase will be reaching all of the shareholders. The major shareholders must obtain a positive response from over half of the shareholders among the public in order to obligate the holdouts to accept their offer.
BioCanCell held its TASE IPO in 2006. Clal Biotechnology acquired the Hebrew University of Jerusalem's stake in 2007, and has consistently increased its holding in the company ever since. US managers were hired for the company over the past year, and Clal Biotechnology announced its intention of having the company hold an offering on Nasdaq. BioCanCell announced in October that it had received an offer to invest $20-25 million in the company at a premium of 60% on the share price at that time (which is now lower than the current share price and the price in the offer to purchase), contingent on BioCanCell becoming a private company. Clal Biotechnology's CEO recently said that the TASE was not suitable for BioCanCell. "A decade after its IPO, BioCanCell is no longer suitable for the TASE," Ofer Gonen said. "BioCanCell is now managed by a US team, its market is in the US, and its clinical trials will take place in the US. It now needs to raise tens of millions of dollars for trials, and this amount of money is not available to a medical company in Tel Aviv."
BioCanCell is scheduled to begin two Phase III trials soon but had only $5 million cash at the end of the second quarter of 2017, so it needs investment. The company has developed a drug for treatment of prostate cancer that can also be relevant to other types of cancer at a later stage.
Published by Globes [online], Israel Business News - www.globes-online.com - on December 21, 2017
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