The AIM-listed firm is to acquire SecurEnvoy for £20mln, to be satisfied by £10mln in cash and £10mln through the issue of 200mln new Shearwater shares at a price of 5p each.
The shares sank 9% to 4.40p, giving the company a market capitalisation of £23.4mln.
The newly issued shares represent about 38% of the shares currently in issue, which probably explains the share price slide.
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10.08 ... URU Metals and Ortac Resources rise
Normally companies release news late in the trading day when they expect a negative reaction, but URU Metals Limited (LON:URU) does things differently.
The shares climbed 24% to 2.45p this morning after an announcement was released at 4.25pm yesterday revealing that a shed-load of options have been granted to directors, some of which are exercisable at 6p a share and others at 9p.
The base metals and uranium explorer also revealed that preliminary results from the laboratory on the magnetite test work at its Zebediela will be available by the beginning of next week.Sector peer Ortac Resources Limited (LON:OTC) was a bit more conventional, releasing its update on developments at its rejuvenated Sturec gold project at Kremnica in Slovakia.
The company has it has entered into an agreement to form a joint venture with a Slovakian company to jointly develop the Sturec.
The Sturec project has a reserve of just under 900,000 oz gold equivalent and has progressed to pre-feasibility stage.
Meanwhile the process for final validation of the underground mining licence as announced on 17 March 2017 continues on track.
READ Ortac Resources soars on possible joint venture partner for Sturec gold mine project in Slovakia