Lifeclean: Securing capital - Redeye

Redeye is favorable to the news that Lifeclean has decided to improve its short-term financial position through the issue of convertibles and a directed issue of shares. The total amount raised would be SEK 9.5m. We have a positive view of the proposed bridge financing with existing owners and board members as a potential rights issue in this market environment, which would most likely have meant a substantial discount and higher cost due to the need for guarantors. This move will strengthen the sales force and have the resources to finalize some regulatory issues. The fact that the newly appointed CEO has decided to invest capital is also a good signal of trust in the company from management. We will adjust our assumptions slightly when we see the outcome of convertibles and the direct issue. We do not expect to change our fair value range or base case more than marginally. The proposed solution for short-term financing is positive as it gives the company time to get sales going, especially in the PFAS field, which has a lot of potential given new EU regulations in this area.