Tokyo, Japan and Cambridge, UK, 28 November 2023 – Sosei Group Corporation (“Sosei Heptares” or “the Company”; TSE: 4565) announces that its Board of Directors resolved today to issue new shares to raise JPY 8 billion (approx. US$54 million) in a third party allotment to JIC VGI Opportunity Fund No.1 Investment Limited Partnership (“OPF1”; the “Third Party Allotment”), a new fund operated by JIC Venture Growth Investments Co., Ltd. (“JIC VGI”), an affiliate of Japan Investment Corporation (“JIC”).
OPF1 is a new fund that was established in September 2023 by JIC VGI, and its planned duration is 10 years. Through OPF1, JIC VGI will engage in investment activities in industries where risk and growth capital is scarce, such as healthcare and life sciences, to support the growth and sustainable development of innovative companies listed on the Tokyo Stock Exchange – one of the JIC initiatives included in the Japanese government's “Startup Development Five-year Plan.” The proposed investment in Sosei Heptares is the first investment project from OPF1.
The Third Party Allotment is part of and conditional on the successful completion of a series of transactions launched today by Sosei Heptares designed to strengthen the Company’s financial position and provide capital for strategic growth investments through the issuance of New Shares and Convertible Bonds and buyback of existing Convertible Bonds, announced separately today. The details of the transactions and Use of Proceeds can be found by clicking here.
The price per share for the Third Party Allotment would be the same as the issue price (offer price) in the concurrent International Share Offering announced alongside the Third Party Allotment.
The Third Party Allotment will raise a total of JPY 8 billion, which Sosei Heptares intends to use, alongside proceeds from the overall transaction for strategic growth investments, mainly for: in-licensing of developed products and programs; development and commercial activities for late-stage products in Japan, and; expansion of drug discovery and early-stage development capabilities, including its proprietary structure-based drug discovery platform.
Chris Cargill, President & CEO of Sosei Heptares, commented: “We are delighted that JIC VGI has decided, conditionally, to make such a substantial investment in Sosei Heptares through its new OPF1 fund. JIC VGI invests in companies and industries of significant economic benefit to Japan. We believe that this OPF1 investment recognizes the importance of the growing biopharmaceutical industry to Japan and the position of Sosei Heptares as an emerging global champion for the sector. Our intention is to use the proceeds from the OPF1 financing, along with those raised concurrently in the International Share Offering, to further strengthen our organization’s capabilities and accelerate our business growth in bringing new medicines to patients in Japan and across the world.”
About JIC VGI Venture Growth Investments Co., Ltd.
The mission of JIC Venture Growth Investments Co., Ltd. (JIC VGI), a Japan Investment Corporation affiliate, is to promote innovation in Japan, improve international competitiveness, and address and resolve industrial and social issues in Japan through venture growth investment activities.
The main strategy of VGF1 is to leverage investment in promising growth/later-stage startups to support their further growth prior to initial public offering. VGF2, which invests primarily in expansion, growth/later-stage startups from Series B onward that require growth capital, also invests in early stage and beyond startups in the deep tech and life science fields.
In addition to the “direct secondary strategy,” through which OPF1 directly acquires existing shareholder interests in middle- and later-stage startups that are expected to IPO within a few years and then supports their growth, OPF1 has an “after-market strategy” to support the sustainable and rapid growth of startups that face challenges in raising growth capital following IPO.
Through both strategies, OPF1 plans to push the growth curve of startups to the next level of success and support the sustainable and rapid growth of promising listed startups. OPF1 also aims to attract private investment funds and contribute to the revitalization of the domestic secondary and growth markets, as well as to the strengthening and expansion of the overall startup ecosystem in Japan by creating successful investment cases in the direct secondary and aftermarket sectors. (Link)
Click here for more information about JIC VGI.