NetScientific PLC (LON:NSCI) has put itself up for sale, with bosses claiming that the market is currently undervaluing the strength of its portfolio of healthcare companies.
The AIM company reeled off a list of highlights in its portfolio which it said showed the “significant progress” it has made in recent months.
READ: NSCI portfolio firm PDS to merge with Edge Therapeutics
Among the achievements was a Series A funding round for Glycotest which valued the blood test maker at US$25mln.
NetScientific’s stake in that is worth around US$13mln on its own, whereas its market cap is less than US$27mln despite it having several other investments.
Another portfolio company, PDS, announced this morning it is merging with Edge Therapeutics, while Vortex has started to commercialise its VTX-1 liquid biopsy.
Digital health group Wanda is also gaining commercial traction, and disease testing firm ProAxsis is expected to become self-financing within the next year.
“Against these recent developments, the board believes that the market is undervaluing NetScientific's portfolio,” read Monday afternoon’s statement.
“Therefore, the board has determined that it is appropriate to evaluate all options, including a sale of the company or certain of its portfolio companies, to maximise value for shareholders.”
Bonus for bosses if they stay on during sale process
The company also set out certain conditions subject to which the board could earn a bonus equal to 50% of their annual salary.
For chief executive Francois Martelet that works out to £123,600, while it comes to £103,000 for chief financial officer Ian Postlethwaite.
Both men will be entitled to their bonus should they: 1) be made redundant within three months of the sale completing; 2) have not given notice of their resignation before being made redundant; and 3) upon termination of their employment, enter into a settlement agreement with the company.
“We believe that to achieve the best outcome for our shareholders it is crucial that we retain the services of our key executives throughout the formal sale process, hence we have amended their service terms as described above,” said Sir Richard Sykes, chairman of the remuneration committee.
NSCI shares were up 1.5% at 26.9p late on Monday afternoon.