The Paradigm Biopharmaceuticals Ltd (ASX: PAR) share price has returned from its trading halt and crashed deep into the red.
In morning trade, the ASX All Ords share is down 34% to a 52-week low of 40.5 cents.
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Why is this ASX All Ords share crashing?
Investors have been hitting the sell button today after the biopharmaceutical company announced the completion of the institutional component of a $30 million capital raising.
According to the release, the placement and institutional offer raised a total of $21.1 million and received strong support from new and existing institutional and sophisticated investors in Australia and internationally.
These funds were raised at 43 cents per new share, which represents a 30% discount to where the ASX All Ords share was trading prior to its halt.
The company will now push ahead with its 1 for 10 retail entitlement offer to raise the balance.
Why is Paradigm raising funds?
The funds raised will be used to support Paradigm through to mid-2025, which includes the expected top-line readout from the Phase 3 osteoarthritis (OA) clinical trial.
Paradigm's managing director, Paul Rennie, commented:
I would like to thank all the existing shareholders for their continued support of Paradigm and would like to welcome the new institutional investors as we continue to progress iPPS as a potential blockbuster therapy for osteoarthritis. To receive such strong support is a great endorsement of the ongoing strength of our clinical assets and focusses the Company on progressing our phase 3 OA clinical program and commercial licensing discussions to achieve value for all Paradigm shareholders.
This ASX All Ords share is now down approximately 70% over the last 12 months.
