Kadimastem plans listing on Nasdaq through merger

Biotech news credit: Tali Bogdanovsky, Shutterstock
Biotech news credit: Tali Bogdanovsky, Shutterstock

The Israeli biotech stem cell company will delist from the TASE.

Israeli stem cell company Kadimastem (TASE: KDST) has announced plans to merge with a Canadian company traded on Nasdaq and to delist from the TASE. The name of the company has not been disclosed. Kadimastem has a market cap of NIS 27 million on the TASE>

After the deal is completed, Kadimastem's shareholders will hold 88% of the merged company and the Israeli company's activities will switch to the merged company. Following the announcement Kadimastem's share price jumped 30% on Thursday but fell 10.5% today.

Kadimastem was founded in 2009 based on the research of Prof. Michel Revel of the Weizmann Institute of Science. The company held its IPO on the TASE and since then has lost 98% of its value. The company is developing treatments based on stem cells for illnesses like ALS and diabetes. Its ALs treatment began a multi-center clinical trial in the US in March 2023 and its diabetes treatment is in the pre-clinical trial stage. At the end of the second quarter of 2023, the company had NIS 4.2 million in cash and its financial report had a "going concern" qualification.

In the past, the company has been through a control struggle, mainly due to the high involvement of founder and CTO Revel, previously controlling owner of the company, in setting the company's strategy. Today the company is managed by Asaf Shiloni (CEO) and Ronen Twito (Chairman ). After a dilution in Revel's holding (27% today), the other main shareholders of the company are now Julien Ruggieri (16.6%), Martin Schlaff's Alpha Capital (10.9%), Adi Wolf's Clover Wolf Fund (10.6 %) and Ilex Medical Company (5.6%).

Listing first on the Tel Aviv Stock Exchange and then on Nasdaq is a logical route for biotech companies, which usually need significant capital raising before they start seeing revenue. Nasdaq facilitates access to large amounts of capital.

Twito said, "Listing Kadimastem on Nasdaq is an important and necessary goal for Kadimastem’s development and its progress to the company's target markets in the U.S., as we have stated in the past. The MOU is an important step in that direction. It follows the Company's report of receipt of FDA approval for a Phase IIa multi-site clinical trial in the US for the treatment of ALS, and the joint development agreement signed with iTolerance Inc., a Florida based company with a product in the field of diabetes, which we recently reported to have a successful joint INTERCT meeting with the FDA. We believe that the exposure to the US capital markets will assist Kadimastem in the development of the company's clinical assets and preparations for the planned multi-site clinical trial for the US, and as a result will create value for the company's shareholders."

Published by Globes, Israel business news - en.globes.co.il - on February 18, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Biotech news credit: Tali Bogdanovsky, Shutterstock
Biotech news credit: Tali Bogdanovsky, Shutterstock
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