• Rua Bioscience is seeking up to $20m through an Initial Public Offering, and has today launched its Product Disclosure Statement (PDS).
• 40 million shares are available, at 50 cents per share.
• A priority offer of $5m shares is available to Tairāwhiti residents, existing shareholders in Waiapu Investments Limited and other people closely associated with the business.
• A total of $15m shares have been allocated across a number of retail brokers in New Zealand, as well as to a small number of institutional investors.
• The Offer is expected to open on Monday 5 October 2020.
• There is no public pool of shares available in the Offer, and members of the public that do not meet the priority criteria are encouraged to contact their broker.

Based on strong commitments from a bookbuild process, New Zealand pharmaceutical company Rua Bioscience Limited today lodged its Product Disclosure Statement (PDS).

Rua Bioscience was founded in 2016 on the East Coast, and the company is aiming to be a leading producer of cannabinoid derived medicines.

Up to $20 million in new capital is being sought to fund Rua’s next stage of development, support the achievement of sustainable revenue and accelerate growth. The company’s market capitalisation of $70 million assumes the offer of 40 million shares, at the offer price of 50 cents per share, is fully subscribed.

Rua intends to list on the NZX Main Board in late October 2020. All funds raised will be for growth, with no sell-down by existing shareholders at the time of IPO. Cornerstone shareholders, directors and senior managers who are currently shareholders in Rua will be escrowed for approximately 11 months.

Chairman Trevor Burt says Rua received strong support in the bookbuild.

“We are proud of the company, its progress and its clear strategy presented in the PDS for prospective investors,” says Mr Burt.

Co-founders Manu Caddie and Panapa Ehau say “The IPO is an important step in realising our goal of creating a sustainable business that delivers high value jobs and contributes to economic opportunities for the Waiapu Valley and the wider Tairāwhiti region.”

“We are very pleased that New Zealand’s investment community sees Rua as a credible and focused company within a sunrise industry. The demand for shares was well in excess of our target, and allocations to some participants in the bookbuild needed to be scaled.” - Rua Bioscience Board Chair, Trevor Burt

Offer details

A total of $15 million shares have been allocated across a number of retail brokers in New Zealand, as well as to a small number of institutional investors.

A Priority Offer of $5 million of shares is available to Tairāwhiti residents (in the postcodes of 4000-4099), existing shareholders in Waiapu Investments Limited and other people closely associated with the business.

The Offer is expected to open on Monday 5 October 2020. As there is no public pool of shares available in the Offer, members of the public that do not meet the priority criteria are encouraged to contact their broker.

Proceeds from the Offer will be invested in German market development, the expansion of Rua’s current facilities, investment in long-term research and development, and to fund operational costs and working capital as Rua enters commercial production.

The PDS and link to the Register Entry containing additional material information about the Offer is available at www.shareoffer.co.nz/rua

The Lead Manager of the Offer is Northington Partners Limited.

Operations and strategy

Rua Bioscience holds a Medicinal Cannabis Licence from New Zealand’s Medicinal Cannabis Agency and has recently completed construction of an operational controlled cultivation facility in Ruatorea and an extraction and manufacturing facility in Gisborne.

“As medicinal cannabis is a pharmaceutical product, these facilities must be GMP certified before commercial production can occur,” says Rua CEO Rob Mitchell, an industry veteran with over 30 years of global pharmaceuticals experience. “Our GMP paperwork has been submitted to Medsafe and our first GMP audit is scheduled to take place before the end of the year.”

Rua Bioscience has an “export-led” strategy aimed at achieving sustainable revenue as quickly as possible. Rua has signed a binding sales agreement with Nimbus Health GmbH a fully licenced German importer and distributor focussed on medicinal cannabis products.

“We are very pleased to have Nimbus as our distribution partner. Germany is the largest single market for GMP grade medicinal cannabis in the world and Rua anticipates its first exports to occur by the end of 2021,”says Mr Mitchell.

Offer Timetable

All dates mentioned in this release are indicative only and are subject to change.