Completion of IPO

RNS Number:8255Y
AOI Medical, Inc.
22 June 2007

 Not for release or distribution or publication in whole or part in or into the
United States, Canada, Japan, The Republic of south africa, or Australia OR ANY
 OTHER JURISDICTION WHERE SUCH RELEASE OR DISTRIBUTION OR PUBLICATION WOULD BE
                                    UNLAWFUL



               AOI Medical, Inc. ("AOI Medical" or "the Company")



This announcement does not constitute or form part of an offer, or any
solicitation of an offer, for securities and any purchase of or application for
shares in the placing should only be made on the basis of information contained
in the formal admission document to be issued in connection with the placing and
the admission to AIM.



                                                                    22 June 2007



               AOI Medical announces successful completion of IPO



                            Trading commences today



AOI Medical, the medical device company focussing on the development and
commercialisation of innovative orthopaedic medical devices for the spine and
trauma markets, today announces the successful completion of its flotation on
the Alternative Investment Market (AIM) of the London Stock Exchange. The
Company raised a total of #8 million from the placing of new common shares (the
"Placing Shares") with institutional and other investors at a price of 344p per
share (the "Placing").



The Company is expected to have a market capitalisation of approximately #29
million on admission and its common shares are expected to commence trading at
08:00 today under the ticker symbol AOI. Numis Securities Limited acted as
nominated adviser, broker and joint bookrunner to the Company and Cowen
International Limited acted as joint bookrunner to the Company.



Details of the Placing



*         The Placing comprised a total of 2,325,583 Placing Shares. No existing
common shares were sold in the Placing.



*         The Company raised gross proceeds of #8 million from the Placing,
which will be used to fund the continued development of the Company's three key
technology platforms, BAMF Spine, BAMF Trauma and Cervical Plate; fund business
development and marketing expenditure for the Company's technologies; and fund
the development of AOI Medical's initial marketing and sales infrastructure in
the US.



*         The enlarged issued share capital at admission will be approximately
8.4 million common shares.



*         The directors and certain other key employees have agreed not to
dispose of any of their common shares in the Company prior to the anniversary of
admission and for a period of 12 months following such anniversary, any disposal
will be made through Numis to preserve an orderly market in the Company's
shares.



*         Placing Shares will be issued pursuant to Category 3 of Regulation S
of the US Securities Act 1933 and as such will trade in legended, certificated
form for a minimum period of 12 months following Admission.  A depositary
interests facility will be set up and it is anticipated that the legended,
certificated stock will be transferred into this facility when the selling
restrictions fall away.



*         Admission and commencement of trading on the London Stock Exchange's
AIM market is expected to take place at 08:00 today under the ticker symbol "AOI
".  The Company is expected to be listed in the Healthcare sector.



Commenting on the flotation, William Christy, Chief Executive Officer of AOI
Medical, said:



"We are delighted to have successfully completed our IPO and welcome new
investors to the Company. The funds raised will enable us to develop further and
commercialise our innovative and differentiated orthopaedic products to compete
in the large and fast-growing spine and trauma markets."



Enquiries:


AOI Medical, Inc.                                              [phone]
William Christy, CEO

Numis Securities                                              [phone]
David Poutney / Bruce Garrow

Cowen International Limited
Paul Clegg                                                    [phone]

Financial Dynamics                                            [phone]
Ben Atwell / Ben Brewerton / John Gilbert                     [phone]



Background to AOI Medical



AOI Medical is a medical device company focussing on the development and
commercialisation of innovative orthopaedic medical devices for the spine and
trauma markets.  It is progressing the development of three separate technology
platforms: BAMF Spine, BAMF Trauma and Cervical Plate.





Key Strengths



*          Three innovative and differentiated medical technology platforms



*          Protected Intellectual Property



*          Full retention of commercial rights



*          Commercial launch of first product anticipated Q4 2007



*          Targeting large and fast-growing markets



*          Proven executive management team and experienced advisory panel





The Products



BAMF Spine (Balloon Assisted Management of Spine Fractures): a set of tools
intended to be used to address compression fractures of the spine caused by
osteoporosis or trauma.  BAMF Spine will comprise two main instruments: a
cutting device that creates a cavity in cancellous bone, and a balloon-like
device which is used to restore the height of the fractured vertebra and to
deliver and contain the cement in the cavity.  Current techniques used to treat
progressive vertebral compression fractures include vertebroplasty and
kyphoplasty.  The Directors believe that BAMF Spine represents an enhancement
over the current techniques as they expect the process: to be accomplished
through one pedicle access port (incision) rather than two; to require fewer
steps and less time; to be less susceptible to cement leakage; and to return the
fractured vertebra to true anatomic position.



In 2004, the worldwide market for devices targeted towards spinal conditions had
a value of around $3.5 billion and most recent estimates indicate that the
spinal products market will approach $10 billion by 2010.  The growth is being
driven by increasing incidences of osteoporosis in an ageing population and a
growing number of sports related injuries as people become more active.  In
2009, the BAMF Spine global market size is estimated to be over $500 million.
The Company plans to develop devices for biomechanical testing during the first
half of 2007, followed by a 510(k) submission without clinical data in the
second quarter of 2007.  The Directors anticipate that, subject to approval
being received for its 510(k) submission by the fourth quarter of 2007, BAMF
Spine will be launched commercially by the end of 2007.



BAMF Trauma (Balloon Assisted Management of Trauma Fractures): is a removable,
inflatable nail for the stabilisation of fractures of the long bones of the arms
and legs.  AOI's BAMF Trauma differs from the nails currently on the market in
that it is a combination of a stainless steel nail inside a balloon.  The device
is inserted into the intramedullar canal of the fractured bone with the balloon
deflated.  The balloon is then inflated to fill the remaining space.  The
Directors believe that BAMF Trauma will have a technological advantage over
existing products in the market because it will potentially: require a smaller
gauge at the point of insertion; provide a firm structure, adapted to the bone
cavity while in place; and be easily removed by deflating the balloon, thus
narrowing the diameter of the device again.  The Directors believe that this
last feature should make the device particularly interesting for treating
children, in whom growth in the affected limb is impaired if a stabilisation
device is left in place.



It is estimated that over 300,000 intramedullary nailing procedures were
performed in the US in 2002. This number is forecast to grow to more than
400,000 by 2009.  Sales of intramedullary nails are forecast to grow to
approximately $770 million by 2009.  Design and biomechanical strength testing
are planned for completion by June 2007.  AOI is planning to follow the 510(k)
with clinical data route for BAMF Trauma, with clinical studies carried out
under an IDE. Submission to the FDA for IDE approval is targeted for the fourth
quarter of 2007, with patient enrolment for clinical trials scheduled for the
fourth quarter of 2008.  The Company anticipates gaining grant of the 510(k)
clearance from the FDA in the fourth quarter of 2011, following which sales of
BAMF Trauma in the open market are expected to begin.



Cervical Plate (Motion Preserving Cervical Dynamic Stabilisation Plate): an
anterior, semi-constrained artificial ligament designed to provide some
translational and rotational motion when used subsequent to a cervical spine
disc replacement surgery.  Current practice for severe intractable disc disease
is spinal fusion.  Spinal fusion is a medical procedure by which two or more
vertebrae are linked together.  Fusion may be carried out to treat a number of
spinal conditions; however, it causes stiffness of the spine in patients and
increases stress to the adjacent levels of the spine which may lead to
additional morbidity. The failure rate after lumbar fusion has been reported to
be as high as 37 per cent.  Anterior plates provide stability following
decompression and fusion of the cervical spine.  The Directors believe that the
following technical attributes of the Cervical Plate provide it with a
technological advantage over existing spinal fusion techniques: it offers a
motion preservation fusion approach that aims to promote a return to normal
range of motion when used in combination with alternatives to fusion;  the
sculpted design and thickened rails of the Cervical Plate should allow the
support needed to allow multi-directional movement while ensuring disc
compression, reducing pressures across adjacent parts of the spine; and  it is a
smaller device than competitive devices and should therefore be less disruptive.



The US market for spinal fusion products has been estimated to have generated
sales of around $2,152 million in 2004, with revenues projected to grow to
$7,712 million by 2010.  The US market for cervical prostheses and artificial
discs, which the Directors believe is the sector of the market in which the
Cervical Plate will compete, is forecast to be worth approximately $460 million
by 2009.  The Company is planning to obtain FDA approval via the 510(k) with
clinical data route and will apply for an IDE for the product to establish range
of motion data.  Provided that an appropriate motion preserving disc or nucleus
replacement device is identified by the beginning of 2008, the Directors
estimate that the initial commercialisation of the Cervical Plate will commence
in the fourth quarter of 2008 through IDE sales.  The Company aims to gain FDA
approval, with range of motion, in the fourth quarter of 2011, following which
full commercialisation of the Cervical Plate is expected to begin.



Strategy



AOI's goal is to become a leader in the development and commercialisation of
medical devices in its markets.  The key elements of the Company's business
strategy are to:



*          seize the opportunity created in the vertebroplasty (kyphoplasty)
market by offering a simple technology which potentially could be more effective
than available alternatives;



*          achieve a first mover advantage in the trauma fixation market by
offering a novel technology, with advantages particularly relating to the
treatment of children;



*          be the first spine company with range of motion claims in a truly
dynamic cervical plate;



*          leverage the experience and know-how of senior management and planned
field representatives to direct research and development activities and to spur
creation of novel products for the orthopaedics market;



*          in-license technologies or acquire accretive products to enhance the
Company's product pipeline; and



*          establish a proprietary sales force in the US to market orthopaedic
products.





Intellectual Property



The Directors believe that the protection of the Company's intellectual property
is fundamental to its commercial strategy, and AOI actively seeks to protect its
technologies and individual products using patents where appropriate.  In the
US, the Company is licensed under three granted patents (one with regard to BAMF
Spine, on an exclusive basis, and two relating to Cervical Plate) and three
patent applications (two in respect of BAMF Spine, on an exclusive basis, and
one relating to Cervical Plate). The Company owns two pending patent
applications (both in respect of BAMF Spine, one of which also relates to BAMF
Trauma).





Use of Proceeds



The net proceeds of the Placing will be used for:



*          funding the continued development of the Company's three key
technology platforms, BAMF Spine, BAMF Trauma and Cervical Plate;



*          funding business development and marketing expenditure for the
Company's technologies; and



*          funding the development of AOI's initial marketing and sales
infrastructure in the US.





IMPORTANT INFORMATION



Each of Numis Securities Limited ("Numis") and Cowen International Limited
("Cowen"), both of which are authorised and regulated by the Financial Services
Authority in the United Kingdom. are acting only for the Company in connection
with the matters described in this announcement and neither are acting for or
advising any other person, or treating any other person (whether or not a
recipient of this announcement) as their respective client in relation thereto
and will not be responsible to anyone other than the Company for providing the
protections afforded to their respective clients nor for any other advice to any
other person in relation to the matters which are the subject of this
announcement. Such persons should seek their own independent legal, investment
and tax advice as they see fit.



This announcement is only directed at persons in the United Kingdom: (a) who
have professional experience in matters relating to investments and persons who
are investment professionals as defined in article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the
"Financial Promotion Order") or (b) high net worth companies, unincorporated
associations etc who fall within article 49(2)(a) to (d) of the Financial
Promotion Order (all such persons together being referred to as "Relevant
Persons"). This announcement is directed only at Relevant Persons and must not,
in any circumstances, be acted on or relied on by persons who are not Relevant
Persons. Any investment or investment activity to which the announcement relates
is available in the United Kingdom only to Relevant Persons. Accordingly, this
announcement is exempt from the general restriction on the communication of
invitations or inducements to enter into investment activity and has not been
approved by an authorised person as would otherwise be required by section 21 of
the Financial Services and Markets Act 2000.



In Belgium this announcement is being issued solely to and directed at
institutional investors (gekwalificeerde beleggers/investisseurs qualifies)
(pursuant to Article 3,2 of the Belgian Law of 16 June 2006, and as defined in
Article 10, s1 of the Belgian law of 16 June 2006) and does not therefore
constitute an offer of securities to the public (openbare aanbieding/offre
public).  It does not constitute an offer to sell or a solicitation of any offer
to buy any securities in Belgium to persons other than institutional investors.
Accordingly, this announcement is not intended for, and should not be
distributed to, issued to, or directed at Belgian residents other than
institutional investors.  Belgian residents other than institutional investors
should not take any action in relation to this announcement. Pursuant to this
announcement, securities will only be offered to, and subscriptions will only be
accepted from, Belgian institutional investors as defined above.



In Ireland, this announcement is being solely issued to and directed at "
Qualified Investors" within the provisions of Article 2.1(e) of the Prospectus
Directive (EU Prospectus Directive 2003/71/EC), implemented into Irish law by
the Prospectus (Directive 2003/71/EC) Regulations 2005.



In Switzerland, this announcement and its contents are only directed at persons
who are institutional investors with a professional treasury function in
circumstances such that there is no public offer.  The securities offered herein
have not been authorised by the Swiss Federal Banking Commission or any other
Swiss regulatory body nor does this announcement constitute an issue prospectus
or other public material or promotional material for the offering of new shares
in accordance with applicable Swiss legislation.  Accordingly, the securities
offered herein may not be offered or distributed to the public (meaning more
than 20 investors) in or from Switzerland, and neither this announcement nor any
other offering material relating to the securities may be issued in connection
with any such offer or distribution.  The securities and this announcement may,
however, be distributed in Switzerland to a limited number of institutional
investors with a professional treasury function in circumstances such that there
is no public offer.



In Jordan, any marketing of Placing Shares to Jordanian investors is done by way
of private placement only.



In Israel, this announcement may not be distributed to any individual (for the
purpose of this paragraph, the "Israel Public") in Israel or used, or considered
by any member of the Israel Public as, an offer to the Israel Public to sell the
Placing Shares, or a solicitation of an offer from any person to the Israel
Public, to buy or subscribe for the Placing Shares. Any such offer or
solicitation to the Israel Public may only be made in a prospectus published in
Israel in accordance with a permit granted by the Israel Securities Authority
(for the purpose of this paragraph, the "Securities Authority") pursuant to the
provisions of the Securities Law, 5728-1968, of Israel (the "Israel Securities
Law"), after examination and approval of this announcement by the Securities
Authority. This announcement and the Placing Shares hereby offered have not been
submitted to, approved by or registered with the Securities Authority, nor has a
permit been requested or granted, pursuant to the provisions of the Israel
Securities Law.



This announcement and the information contained herein is not for publication,
distribution or release in, or into, directly or indirectly, the United States,
Australia, South Africa, Canada or Japan and does not constitute, or form part
of, an offer of the securities for sale in or into the United States, Australia,
South Africa, Canada or Japan. The offer and the distribution of this
announcement may be restricted by law in certain jurisdictions and persons into
whose possession any document or other information referred to herein comes
should inform themselves about and observe any such restriction. Any failure to
comply with these restrictions may constitute a violation of the securities laws
of any such jurisdiction.



The securities referred to in this announcement have not been registered under
the U.S. Securities Act of 1933, as amended (the "Securities Act") and may not
be offered or sold in the United States unless the securities are registered
under the Securities Act or an exemption from the registration requirements of
the Securities Act is available. The Company does not intend to offer publicly
any securities in the United States or to register any securities under the
Securities Act.



This announcement does not constitute a recommendation concerning the offer. The
value of shares can go down as well as up. Potential investors should consult a
professional advisor as to the suitability of the offer for the individual
concerned.



Forward looking statements



The contents of this announcement include statements that are, or may be deemed
to be "forward looking statements". These forward-looking statements can be
identified by the use of forward-looking terminology, including, without
limitation, the terms "believes", "estimates", "anticipates", "expects",
"intends", "may", "will" or "should". By their nature, forward looking
statements involve risks and uncertainties and readers are cautioned that any
such forward-looking statements are not guarantees of future performance. A
number of factors could cause the Company's actual results and performance to
differ materially from the impression created by the forward-looking statements
including, without limitation, the factors to be described in the risk factors
section of the formal admission document. Save as required by law, the Company
undertakes no obligation to publicly update or revise forward-looking
statements. No statement in this announcement is intended to be a profit
forecast or be relied upon as a guide to future performance.


                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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