Aerocrine launches fully underwritten rights issue of MSEK 259

Not for publication, release or distribution, directly or indirectly, in or into the United States, Canada, Australia, Hong Kong, Singapore, South Africa, Japan or New Zealand.

• The Board of Directors proposes a rights issue of approximately MSEK 259 with pre-emptive rights for existing shareholders and the holders of the company’s convertible bonds 2010/2015
• Four shares entitle to subscription for one new share at SEK 9, equivalent to a discount of 15.1[1] per cent. The subscription period is 20 April-11 May 2012
• Extraordinary General Meeting 10 April 2012 to approve the rights issue

• The rights issue secures financing for the company’s growth strategy. Aerocrine intends to continue building up its US operations to further drive clinical sales of NIOX MINO® and to continue its work to secure reimbursement in the US market
• Novo A/S and Investor Investments Europe Ltd. (wholly owned by Investor Growth Capital AB) have undertaken to subscribe for their entire pre-emptive parts of the issue, corresponding to a total of approximately MSEK 130
• Subscription undertakings without compensation have in total been received for approximately 71 per cent of the rights issue from existing shareholders and institutional investors which thereby become new shareholders in the company. The remaining part of the rights issue is fully guaranteed by existing shareholders and external parties

”The fourth quarter 2011 was the best quarter in the history of the company. Our performance has been propelled by the ATS guidelines, new and supportive clinical trials and a refocused effort on reimbursement and sales. During Q1 we continue working hard to execute against our strategy of gaining more reimbursement in key markets, place more monitors and increase our repeat test business. In addition we, in cooperation with Panasonic, are also focusing on a timely launch of our new monitor.

We are, of course, very pleased that our Board of Directors and shareholders support us and the growth of this company. With this new capital raise we will get the fuel to keep our plan in motion and build a successful medical device company”, says CEO of Aerocrine Scott Myers.

Background and motive

Since it was founded, Aerocrine has successfully developed a method based on exhaled nitric oxide as a marker of respiratory inflammation. The company has subsequently also developed a number of products for the diagnosis and treatment of asthma.

For Aerocrine, 2011 was an eventful year, with a strategic decision to increase the company’s focus on sales and marketing, particularly in the US. This was based on Aerocrine’s unique, market-leading position. The company also achieved considerable progress in the US, which is one of the world’s largest and most important markets in Aerocrine’s field. This strategic decision has resulted in the company now establishing a clear growth strategy.

Against this background, the company has decided on a rights issue to secure financing for the implementation of this growth strategy. In the short term, Aerocrine intends to continue focusing on building up its US operations to further drive clinical sales of NIOX MINO® and to continue its work to secure reimbursement in the US market where the company is the sole supplier of officially approved respiratory inflammation testing products. The company will also initiate a clinical development programme to strengthen the documentation of its method. Beyond this, the focus will be on sales in prioritised European countries, continued market development for NIOX MINO® in China and Japan together with the company’s local partners, and to initiate launch activities for the first product developed in cooperation with Panasonic Healthcare. Over the next few years, the objective is to build a solid financial platform based on growing sales, to then become a financially independent company with positive cash flows.

The Rights Issue                 

The Board of Directors resolved on 14 March 2012, subject to approval by the general meeting, to issue new shares of approximately MSEK 259, before transaction costs, with pre-emptive rights for existing shareholders and the holders of the company’s convertible bonds 2010/2015.

Four shares entitle to subscription for one new share at a subscription price of SEK 9 per share. The subscription price represents a discount of 15.1 per cent to the theoretical ex-rights price (TERP) calculated on the closing price as of 14 March 2012, of SEK 11.00.

Novo A/S and Investor Investments Europe Ltd. (wholly owned by Investor Growth Capital AB) have undertaken to subscribe for their entire pre-emptive parts of the issue, corresponding to a total of approximately MSEK 130.

Subscription undertakings without compensation have in total been received for approximately 71 per cent of the rights issue from existing shareholders and institutional investors which thereby become new shareholders in the company. The subscription undertakings and commitments to underwrite without compensation, described above, total MSEK 183. The remaining part of the rights issue, corresponding to approximately 29 per cent (MSEK 76), is fully guaranteed by existing shareholders and external parties.

The amount expected to be raised in the rights issue, before transaction costs, is approximately MSEK 259. Subscription undertakings and underwriting commitments have hence been received for the total amount of the rights issue.

The rights issue is subject to approval by an Extraordinary General Meeting to be held on 10 April 2012. Undertakings to vote in favour of approving the rights issue are in place with respect to approximately 67 per cent of the shares and votes in Aerocrine. Notice of the Extraordinary General Meeting is announced in a separate press release today.

A detailed description of the rights issue will be available in the prospectus, which will be published ahead of the subscription period and made available on Aerocrine’s website.

Indicative timetable

10 April 2012                                                                  Extraordinary General Meeting to approve the rights issue

13 April 2012                          First day of trading in the Aerocrine share excluding the right to receive subscription rights

17 April 2012                          Record date, i.e. shareholders registered in Aerocrine’s share register as of this day will receive subscription rights for participation in the rights issue

20 April-8 May 2012                                Trading in subscription rights

20 April-11 May 2012                              Subscription period

Advisors

ABG Sundal Collier is acting as financial advisor and Vinge as legal advisor to Aerocrine.

For further information, please contact:

Scott Myers, President and CEO of Aerocrine

Tel: +46-(0)8-629 0781

E-mail: scott.myers@aerocrine.com

Michael Colérus, CFO of Aerocrine

Tel: +46-(0)8-629 0785

E-mail: michael.colerus@aerocrine.com

Anders Williamsson, Chairman of the Board of Aerocrine

Tel: +46-(0)708-721 865

E-mail: anders.f.williamsson@telia.com

About Aerocrine

Aerocrine AB (publ.) is a medical technology company focused on the improved management and care of patients with inflammatory airway diseases. As the pioneer and leader in the technology to monitor and manage airway inflammation, Aerocrine markets NIOX® Flex and NIOX MINO®. Both products enable fast and reliable management of airway inflammation and may therefore play a critical role in more effective diagnosis, treatment and follow-up of patients with inflammatory airway diseases such as asthma. Aerocrine is based in Sweden with subsidiaries in the US, Germany and the UK. Aerocrine’s shares were listed on the Stockholm Stock Exchange on 15 June 2007.

Aerocrine discloses the information provided in this press release pursuant to the Securities Markets Act. The information was provided for public release on 15 March 2012 at 8:00 CET.

This press release has been prepared in both Swedish and English. In the event of any discrepancy in the content of the two versions, the Swedish version shall take precedence.

This press release does not constitute an offer of any securities of Aerocrine. The rights issue is not directed to shareholders or other investors domiciled in the United States, Canada, Australia, Hong Kong, Singapore, South Africa, Japan or New Zealand, or in any other country where participation in the issue would require additional prospectuses, registration or other measures other than those pursuant to Swedish law or would conflict with regulations in such country. No shares, interim shares, subscription rights or other securities issued by Aerocrine have been or will be registered in accordance with the United States Securities Act of 1933, or in accordance with any securities legislation in any state of the United States or any province in Canada. Accordingly, no new shares, interim shares, subscription rights or other securities issued by Aerocrine may be transferred or offered for sale in the United States or Canada, other than in such exceptional cases that do not require registration. The rights issue is directed only at (i) persons who are outside the United Kingdom; (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended); or (iii) persons to whom it can otherwise lawfully be directed at.

[1] Discount to the theoretical ex-rights price (TERP) calculated on the closing price as of 14 March 2012, of SEK 11.00.