Creo Medical – a small biotech company specialising in surgical endoscopy – will float on the London junior market tomorrow after raising some £20m from investors.
The shares will begin trading on Friday, priced at 76p, giving Creo a market capitalisation of £61.2m.
The raising, with about a fifth coming from existing backers, will be used to develop a range of surgical devices that can be used with an endoscope – a flexible tube with a light and camera that is inserted into the body.
Creo recently completed its first clinical study in humans and clearance from European regulators is expected in the first quarter of next year.
Creo is also planning on expanding over the next couple of years, launching into Europe in 2017 and the US the year after. The capital raised is expected to last the company at least two years.
The timing of the deal came into question due to the UK’s June Brexit vote, with the final decision to list decided just two days after the vote.
“It was the strength of the proposition that helped us make the decision. The endoscopy industry hasn’t had the innovation other medical sectors have and investors could see the potential,” Creo chief executive Craig Gulliford told City A.M.
Another draw for investors, City A.M. understands, was the company’s founder Chris Hancock, who was part of the senior engineering team at Gyrus Medical. Gyrus came to the market with a value of £42m and got bought by Olympus in 2007 for $1.4bn.
There is also a number of the former Gyrus management team involved with the company. Finance Wales and Hoya Pentax Medical, a Japanese medical technology company, were early backers of Creo.
Creo, which employs 28 people, currently has over 75 patents granted and 150 patents pending. It has a research and development site in Bath and a manufacturing facility in South Wales.
Cenkos Securities is acting as the nominated adviser and broker to Creo for the IPO.