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Sale of Wanda and Vortex

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RNS Number : 7839T
NetScientific PLC
22 March 2019
 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014

 

NetScientific plc

("NetScientific" or the "Company")

Sale of Wanda and Vortex

 

On 18 March 2019 NetScientific announced that it had received an indicative proposal from a third party regarding the sale of the Company's shareholdings in Vortex Biosciences, Inc. ("Vortex") and Wanda, Inc. ("Wanda") (the "Potential Disposal").

It stated that, having considered the indicative terms of, and taking account of the anticipated timeline to complete and the execution risks of the Potential Disposal, the Board had concluded that it was not in the best interests of the Company and the remaining Portfolio Companies to proceed with the Potential Disposal. Subsequently, the directors of Vortex and Wanda respectively resolved to effect the orderly wind up of those companies.

Following the announcement of 18 March 2019, NetScientific received a further approach from that third party, Deeptech Disruptive Growth Investments Ltd ("Deeptech"), an affiliated special purpose vehicle ("SPV") of EMV Capital Ltd, detailing revised terms regarding the Potential Disposal. Those revised terms addressed satisfactorily the Board's previous concerns regarding the timeline and execution risk relating to the Potential Disposal. As such, the Company announces that it has completed the sale of its interests in Vortex and Wanda, together with any outstanding loans and convertible loan notes owed by Wanda or Vortex to the Company, to Deeptech for cash proceeds of £150,000 (the "Sale").

Immediately prior to completion, NetScientific was interested in approximately 95.0% and 70.8% of the issued shares of common stock of Vortex and Wanda, respectively, and 100% of the Preferred Shares of Wanda. Additionally, the Company had loans outstanding to Vortex of £22,223,000.

In the year ended 31 December 2017, the losses before tax of Vortex and Wanda included within the consolidated accounts of NetScientific amounted, in aggregate, to £4,960,000 and £1,303,000, respectively and the net liabilities of Vortex and Wanda at the same date were £16,624,000 and £8,946,000, respectively. The inter-company debt of Wanda, £7,654,000, was fully written off in February 2019.

Melvin Lawson, who is interested in 29.98% of the issued share capital of NetScientific, is also the principal provider of finance to the EMV Capital Ltd SPV Deeptech. Accordingly the Sale represents a related party transaction in accordance with AIM Rule 13. The Directors consider, having consulted with the Company's nominated adviser, that the terms of the Sale are fair and reasonable insofar as shareholders of the Company are concerned.

NetScientific will utilise the proceeds of the Sale towards its ongoing working capital requirements.

For more information, please contact:

NetScientific

François R. Martelet, M.D., CEO

Ian Postlethwaite, CFO    

                   

Tel: +44 (0)20 3514 1800

WH Ireland Limited (NOMAD, Financial Adviser and Broker)

Chris Fielding / Jessica Cave

 

Tel: +44 (0)20 7220 1666

 

About NetScientific

NetScientific is a transatlantic healthcare technology group with an investment strategy focused on sourcing, funding and commercialising technologies that significantly improve the health and well-being of people with chronic diseases.

For more information, please visit the website at http://www.NetScientific.net


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
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