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.
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.
