AIM-listed medical devices company Belluscura PLC (AIM:BELL) is raising £4.7 million through a merger with TMT Acquisition PLC (LSE:TMTA).
TMT Acquisition is effectively a blank-cheque company listed on the standard segment of the London Stock Exchange with no trading activities, though it does have cash and cash equivalents of £4.7 million on its balance sheet.
Per TMT’s offer terms released in a Tuesday statement, Belluscura will be required to buy TMT’s shares at a 24.7% volume-weighted share premium valuing the blank-check company at £6 million.
This effectively means Belluscura will be buying £4.7 million of cash reserves for £6 million of new shares in Belluscura, a premium potentially worth paying to circumvent the onerous and costly task of going through the standard IPO listing process.
Also announced on Tuesday, Belluscura issued a £2.72 million convertible debt round and an additional £600,000 equity placement.
The combined reverse merger and debt and equity rounds will significantly bolster Belluscura’s balance sheet as it seeks to expand its sales pipeline.
Within 30 minutes of announcing the possible offer, Belluscura’s chief financial officer Tony Dyer stepped down “with immediate effect” to make way for Simon Neicheril.
“With a large proportion of the company's operations located in the US, and immediate growth plans in Asia, Tony and the board have agreed that it is in the best interests of the company to align its financial base alongside its operations in the US and Simon will be located at the company's headquarters in Texas,” read the statement.
It marks the second major development for a Tekcapital PLC (LSE:TEK) portfolio group this week, following Microsalt's AIM IPO announcement on Monday.
Tekcapital owned an 11.2% share of Belluscura, valued at $6.4 million as of June 30.