Ellume set to go into voluntary administration; Designated FTI

A meeting of creditors will be held in mid-September.

The appointment, confirmed Thursday morning, comes after the company denied addressing management earlier in the week.

It is likely to surprise investors who had considered Ellume one of the best pre-IPO prospects in the country thanks to its US technology and contracts.

Ellume has had its slip-ups, including questions about the accuracy of its home COVID-19 tests and a product recall last year, yet investors thought all problems were solved. Investors tipped a $500 million valuation late last year and were told it could return for a $1 billion float in 2022.

The company has been firmly on the radar of institutional investors after a handful of funding rounds. It was targeting an April 2022 initial public offering through broker-dealers Morgans and Ord Minnett.

The convertible note deals included a $10 million injection from Qiagen in 2020, $8.26 million to high net worth investors in June 2021, a further $69 million in August last year, and a follow-up raising to fund the business up to a float.

All of the notes were issued under the premise that they would be paid through an initial public offering or trade sale, which has not yet occurred.

The plan, according to Ellume’s signed accounts, was to raise $100 million in November of last year and list in April of this year.

Investors can only hope that the Ellume board calls on managers to enact a well-thought-out restructuring, rather than go through a fire sale because it ran out of money. If it is a restructuring, there could be an interesting fight between the holders of shares and convertible notes for control of the US business.

The administration comes after the US government awarded Ellume a series of grants and contracts to develop its COVID-19 antigen tests and expand its manufacturing capacity.

Ellume was founded by critical care physician Dr. Sean Parsons in 2010 after seeing an unmet need for rapid diagnostic solutions during the 2009 swine flu pandemic.

Its tests are in use in the US, where it has a $305 million deal with the US Department of Defense to supply 20 million rapid COVID-19 antigen test kits.

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