GlaxoSmithKline plc today announced that its wholly-owned subsidiary Glaxo Group Limited (GSK) will receive a 25.4% minority equity stake, representing a £1,250,000 investment, in Autifony Therapeutics Limited, a UK-based biotechnology start up created through a funding round of up to £10 million alongside investors Imperial Innovations and SV Life Sciences.
Under the terms of the agreement, Autifony will issue 850,000 A ordinary shares to GSK in exchange for a number of pre-candidate voltage-gated ion channel modulator compounds and associated patent applications and data for development in hearing loss, as well as 571,429 Series A preferred shares in recognition of £400,000 worth of development work funded by GSK on behalf of Autifony.
GSK will also be eligible to receive a further 550,000 A ordinary shares on achievement of a pre-determined milestone, at which time there will be a further investment by the existing consortium and GSK will then own 13.2% of Autifony on a fully diluted basis.
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GlaxoSmithKline cautionary statement regarding forward-looking statements
Under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, GSK cautions investors that any forward-looking statements or projections made by GSK, including those made in this announcement, are subject to risks and uncertainties that may cause actual results to differ materially from those projected. Factors that may affect GSK's operations are described under 'Risk Factors' in the 'Business Review' in the company's Annual Report on Form 20-F for 2010.