Shares of Sedgefield, County Durham-based radiation detection company Kromek Group rose about 12% after it announced a conditional firm placing and open offer of shares to raise up to £21 million.

Kromek said the firm placing was undertaken with new and existing institutional investors and was over-subscribed.

The firm said some of its directors indicated their intentions to subscribe for new ordinary shares under the open offer.

It said fund manager Miton Group, an existing substantial shareholder, agreed to subscribe for 31.2 million placing shares which would take its shareholding in Kromek to about 18.6%.

The move, subject to shareholder approval, involves the firm placing of 100 million ordinary shares at 20p, and an open offer of 5.129 million shares on the basis of one new ordinary share for every 30 existing ordinary shares, at 20p each.

Kromek shares rose 12% to around 22p, giving it a current stock market value of around £33 million.

Kromek designs, develops and produces x-ray and gamma ray imaging and radiation detection products for the medical, security screening and nuclear markets.

The firm said it expects to use £17 million of the net proceeds to strengthen its balance sheet and £3 million for general working capital requirements, capital expenditure and to invest in its patent portfolio.

Kromek chairman Peter Williams said: “We are pleased with the support shown by our current shareholders and we welcome new blue-chip institutions to our register.

“The present fundraising will considerably strengthen our balance sheet, underpinning our plans for the sustained growth of the business and supporting increasing commercial activity through the deployment of our proprietary technology.”