BATM Advanced Communications Ltd (LON:BVC) shares rose on Friday after the company said it completed the sale of its software subsidiary NGSoft to Aztek Technologies following approval from the Israel Competition Authority.
The networking technology and medical lab systems provider said it received 93.7mln Israeli New Shekels (£20.4mln) pursuant to a sale option agreement exercised at the start of March after its signing in mid-January. As part of the agreement, BATM will receive a total of around £20.8mln in cash, including a £2.9mln loan repayment from NGSoft and a dividend payment of around £459,000.
READ: BATM Advanced Communications exercises option to sell NGSoft for US$33mln
BATM said it intends to use the proceeds of the sale to strengthen its “innovation and commercialisation engine” and accelerate its core activities, particularly its network function virtualisation (NFV) and molecular diagnostics segments, which it said offered “transformational growth opportunities in the short to medium-term”.
The company added that the disposal of NGSoft, combined with the increased revenue contribution from molecular diagnostics and NFV, will support an “anticipated improvement in gross margin for 2021”.
BATM shares rose 3.6% to 101.5p in early deals.