Phoenix Group becomes 7% shareholder.
financing strengthens Brainsway's balance sheet and provides strong support for continued growth
HACKENSACK, N.J., Dec. 12, 2017 – Brainsway Ltd. (TASE: BRIN), a leading developer of breakthrough brain disorder treatment technology, is pleased to announce that it has completed an $8.5 million equity financing as part of private stock placement. There was strong demand for the placement among leading institutional investors. The financing was led by the Phoenix Group (Israel), which will own more than 7% in the Company. Noked Capitaland IBI Investment House, a current shareholder in Brainsway, also participated in the financing.
Yaacov Michlin, chief executive officer of Brainsway, said, "We are pleased by the investments made in Brainsway today by some of Israel's leading investors and that the Phoenix Group has become an important shareholder in our company. This is a tremendous vote of confidence in Brainsway's operations, results, clinical and business goals. A group of esteemed entities from Israel's capital market today placed its trust in our growth strategy and our updated business model. Strengthening the Company’s capital base allows Brainsway to expand the lease and sale of the Deep TMS Systems for the treatment of Major Depression Disorder (MDD) in the US and additional markets, prepare for launching our system for the treatment of Obsessive Compulsive Disorder (OCD) in the US (subject to receipt of US Food and Drug Administration marketing permission) and other markets, to accelerate existing clinical trials, to initiate new neurological and addiction trials and to advance the development of the Company's systems. The financing also expands and diversifies our investor base and will help us maintain our global leadership as the world's most innovative TMS company."
The shares to be issued (subject to formal TASE approval) will be classified as restricted shares for a specific period of time, as is customary in private allocations in Israel.
Over the past few quarters, Brainsway succeeded in significantly increasing its order pipeline and growing its revenues. The Company posted record third quarter 2017 revenues, which were 27% higher than the second quarter of 2017, and reduced its quarterly burn rate. As of September 30, 2017, Brainsway had cash on its balance sheet of approximately $6 million and a credit facility with Mizrahi Bank of $6 million. The equity proceeds from this financing will provide additional cash to allow for accelerated growth.