TruScreen Offers 80.9M Placement and 55.5M SPP Options at A$0.02 Exercise Price

Capital Raising Overview

TruScreen Group Limited (ASX: TRU) has launched a capital raising effort comprising a Placement and a Share Purchase Plan (SPP), offering free-attaching Options to investors in Australia and New Zealand. The Placement offers up to 80.9 million Options, while the SPP offers up to 55.5 million Options, both exercisable at a modest price of A$0.02 (NZ$0.022) and expiring one year from issue. Additionally, 25 million Broker Options are proposed to be issued as part of the arrangement.

The capital raising is designed to raise approximately NZ$3 million (~A$2.75 million) upon exercise of these Options, with proceeds earmarked for strategic growth initiatives across key Asian and African markets, including China, Vietnam, Zimbabwe, Uzbekistan, Indonesia, ASEAN countries, and India. The funds will also support working capital requirements and repay an existing line of credit.

Offer Structure and Conditions

The Placement and SPP Options are offered free-attaching to shares issued under the respective offers, with the number of Options issued directly linked to the number of shares subscribed. Importantly, the issuance of these Options is conditional upon shareholder approval, which is scheduled for a Special Meeting on 11 July 2025. Should approval not be granted, no Options will be issued under the Placement or SPP.

Investors should note that the Options will not be quoted on the ASX or NZX, limiting immediate liquidity. The Options are exercisable in whole or in part, with a minimum exercise price of A$0.02 and a one-year expiry. The company has also engaged joint lead managers SP Corporate Advisory Pty Ltd and GBA Capital Pty Ltd to underwrite and manage the capital raising.

Strategic Use of Funds and Financial Impact

The capital raised is intended to accelerate TruScreen’s presence in the Chinese market, distribute Dalton Bio IVD HPV DNA products, and execute public cervical cancer screening programs in emerging markets. The company also plans to develop sales channels with key NGOs and health ministries, targeting growth in Indonesia, ASEAN, and India.

Pro-forma financial statements indicate a strengthened balance sheet post-raise, with increased cash reserves and equity. The company’s issued share capital will increase significantly on a fully diluted basis, reflecting the potential exercise of all Options. This will have a material effect on the company’s capital structure and shareholder control, although no single investor is expected to exceed a 20% voting power threshold.

Risks and Considerations

TruScreen’s capital raising is classified as speculative, with several risks highlighted in the prospectus. These include regulatory and certification challenges across multiple jurisdictions, intellectual property protection risks, manufacturing and supply chain dependencies, and competitive pressures in the cervical cancer screening market. The company also faces operational risks related to distributor performance and key personnel retention.

Investors are advised to carefully consider these risks and the speculative nature of the investment before participating. The company has secured relief from ASIC for the offer documentation and complies with NZX continuous disclosure obligations.

Next Steps

Shareholders will vote on the issuance of Options at the upcoming Special Meeting. The outcome will determine the final structure and scale of the capital raising. Investors and market watchers will be keen to monitor the execution of TruScreen’s strategic initiatives funded by this raise and the subsequent impact on share capital and market performance.