Rex Bionics takes next step

TOM PULLAR-STRECKER
Last updated 17:20 06/05/2014
rex bionics
LAWRENCE SMITH/Fairfax NZ
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Auckland medical technology firm Rex Bionics, which makes robotic "exoskeletons" for the disabled, will float on Britain's junior AIM sharemarket on Thursday through a backdoor listing.

The arrangement completes a complex deal that Rex Bionics entered into with listed London-based investment company Union MedTech last October.

Union MedTech agreed to acquire Rex Bionics in an all-share deal that valued Rex Bionics at £9.5 million ($18.5 million), rename itself Rex Bionics and switch from Britain's small-cap ICAP Securities & Derivatives Exchange, ISDX, to the still junior AIM exchange.

Union MedTech, which was founded by former Rothschilds fund manager Jeremy Curnock Cook, will issue an extra £10m of shares when it lists on the AIM market, providing further capital for Rex Bionics' expansion.

Jenny Morel, managing partner of Wellington venture capital firm No 8 Ventures, which will retain about a 15 per cent stake in Rex Bionics, said it had proved a good investment, and the completion of the deal with Union MedTech was "fantastic".

As well as providing the funds that Rex Bionics needed to begin its expansion, the listing would provide liquidity for investors, she said.

It had proved the value of the venture capital market in New Zealand, she said.

"If we hadn't had venture capital funds, this company would not have got started," she said.

Scotland's Sunday Herald reported that Rex Bionics was struggling to raise money before it was "spotted" by Union MedTech 18 months ago.

The newspaper said the extra funds would let Rex Bionics expand its New Zealand manufacturing and boost its sales team and distributor network, as well as provide additional working capital.

Curnock Cook and Rex Bionics' Scottish-born founder, Richard Little, would retain about 10 per cent of the company after the AIM float, it said.

Britain's Express newspaper said that before last year, Rex Bionics had sold only six of its exoskeletons in 10 years because of their £89,000 price tag.

It quoted Curnock Cook as saying Rex Bionics had taken a "build it and they will come" approach, which rarely worked.

It would now aim its product at rehabilitation centres in Britain, Europe and the United States, including those that catered to injured soldiers, with the aim of selling 12 to 15 a month, he told the newspaper.

Curnock Cook told the the Sunday Herald that analysts believed the company would become profitable in 2016.

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