PARIS - Following a shareholders' meeting, Transghne SA has confirmed that it intends to go ahead with plans to increase its capital, although it is to issue no more than 1,200,000 new shares, rather than the 1,500,000 originally planned, and is still making the operation "dependent on market conditions."

Moreover, given the recent downturn in biotechnology share prices on France's Nouveau Marchi following the new year upsurge, the Strasbourg-based gene therapy company, which is quoted on the Nasdaq as well, is unlikely to raise as much as the Euro100 million it was aiming for. In effect, a further 15.8 percent plunge in its share price on March 23 left it at Euro56 at the close, little more than half the level it was at on March 9 (Euro107.50). At the current price, the planned share issue would raise no more than Euro67 million, or around Euro77 million if lead manager Lehman Brothers International takes up the 15 percent overallotment option it is being offered.

The issue price will be fixed on April 6, applications for shares will be accepted from April 10 and the offer will close on April 12. Settlement and delivery are scheduled for April 17. The price will be established according to the book-building technique and will be at least equivalent to the average share price of Transghne shares on the Nouveau Marchi during 10 consecutive trading days selected from a 20-day period prior to the day the price is fixed.

As previously announced (see BioWorld International, March 15, 2000, p. 1), the leading shareholder, Biomirieux Alliance, is to purchase new shares worth FFr40 million (Euro6.1 million), while the French Muscular Dystrophy Association (AFM; Association Frangaise contre les Myopathies) is to take FFr15 million worth. In a separate operation, Transghne also is to offer 300,000 shares to its staff within the framework of the creation of a stock option scheme.

Should the company decide that market conditions are not propitious to an immediate capital increase, its share issue proposal approved by the French stock market watchdog, the Commission des Opirations de Bourse (COB), is valid for a 26-month period.