TIDMNANO
RNS Number : 2867F
Nanoco Group PLC
15 July 2021
15 July 2021
FOR IMMEDIATE RELEASE
Nanoco Group plc
("Nanoco", the "Company" or the "Group")
Non-dilutive loan note subscription for GBP3.15 million
Nanoco Group plc (LSE: NANO), a world leader in the development
and manufacture of cadmium-free quantum dots and other specific
nanomaterials emanating from its technology platform, today
announces the completion of a non-dilutive subscription for loan
notes by its major shareholders, raising gross proceeds of GBP3.15
million (the 'Loan Notes').
Highlights
-- Non-dilutive subscription for 4,500,000 Loan Notes by Lombard
Odier Asset Management (Europe) Limited ('Lombard Odier') and ORA
Capital Limited (a company associated with Richard Griffiths),
together the Company's 'Major Shareholders', raising GBP3.15m
gross, on commercially advantageous terms for Nanoco
-- Excellent progress expanding product and customer portfolio -
actively engaged with five customers on eight different materials
including the customer announced on 5 July 2021
-- Confidence remains high in the strength of the Company's case
in the litigation against Samsung and of a favourable and
transformative outcome for shareholders
-- The proceeds from the Subscription extend Nanoco's organic
business cash runway beyond the point of visibility on commercial
production orders and key dates in the Samsung litigation
process
Background to and benefits of the subscription for the Loan
Notes
The Group continues to make excellent progress in expanding its
product and customer portfolio of nano-materials for use in
infra-red sensing applications. Since 2018 Nanoco has expanded its
engagement from one customer and one material development programme
to five customers on eight different materials today. The Company
is working to deliver its ultimate goal of offering multiple
materials to fill each of the major potential device operating
wavelengths to the market.
The Group announced one such example on 5 July 2021 in a new
development agreement with a very significant Asian Chemical
company that supplies materials to various major electronics
markets. Roadmaps already published by another customer for their
own devices suggest commercial production orders may be placed with
Nanoco during 2023 with potential visibility in late 2022, subject
to the successful delivery of all intervening technical milestones
and final production validation of the Company's materials
manufactured at its Runcorn site.
On 28 June 2021, the Company announced that it had petitioned
the Court in the Eastern District of Texas (the 'Court') to defer
the expected trial date for its litigation against Samsung for the
alleged wilful infringement of the Company's IP. The Company was
seeking a delay until after the outcome of the inter partes reviews
(IPRs) of the patents in the case is known, expected by May 2022.
This petition has now been granted and has a number of benefits for
Nanoco including the resolution of the majority of issues relating
to patent validity in advance of the Court case. This will allow
Nanoco to focus its trial efforts on the question of infringement
and any resulting damages. The Group now expects the trial to be
held in late 2022 and remains confident in the strength of Nanoco's
case and a favourable and transformative outcome for
shareholders.
To underpin both the organic and litigation opportunities set
out above, the Company's Major Shareholders have subscribed for an
aggregate of 4,500,000 Loan Notes on the terms set out below. This
extends the cash runway for the Group's organic business activities
beyond the points when the Company expects visibility on commercial
production orders, the expected initial findings for the IPRs, and
the verdict in the re-scheduled trial.
Details of the non-dilutive subscription for the Loan Notes
The Loan Notes are unsecured and have a nominal value of GBP1
each, an arrangement fee of 1.4% of the nominal amount and are
repayable three years from completion which is expected to take
place prior to 31 July 2021. The subscription price of 70p
represents a discount to the nominal value of GBP1 equivalent to
12% interest per annum. The Company may redeem the Loan Notes at
any time prior to their maturity at 80% of nominal value during the
first year of the term; 90% at any time in year two, and 100% at
any time in year three. In the event of a successful outcome to the
litigation or a change of control of the Company, the Loan Note
holders are entitled to a success bonus of 105% of the nominal
value of the Loan Notes Subscribed.
Importantly, the terms of the subscription for the Loan Notes
ensure that there is no dilution for equity holders at this
transformational point in the Company's value. The terms of the
subscription are superior to all of the offers received in the
independent tender exercise carried out to select the litigation
funding partner. The Subscription will not materially alter the
economic impact on the Group of any litigation award and the Board
still expects that Nanoco will retain around 50% of a modest award
from the litigation, rising to around 80% of a more substantial
award.
The Board has therefore concluded that the Loan Notes represent
good commercial value for the Company, are on fair market terms,
and are in the best interests of shareholders.
Brian Tenner, Chief Executive Officer of Nanoco Group said:
"The Group is expanding its nano-material offering to an
increasing number of global customers focused on infra-red sensing
applications in a number of significant electronics markets. It is
encouraging that a major customer has published its own development
roadmap which suggests commercial production orders for Nanoco in
2023, in addition to the new strategic customer announced on 5 July
2021. This is an exciting and critical time for the continued
funding of our organic operations.
"We are also very pleased with the progress of our litigation
against Samsung. We have simplified our route forward and
significantly enhanced the prospects of a successful outcome noting
that operational trading companies which actually practise their
IP, such as Nanoco, typically enjoy higher success rates at trial
than those who do not. In addition, the support of the litigation
funding partner will ensure that the Loan Note funds can be focused
solely on exploiting existing organic commercial opportunities.
"The Loan Notes will not only enable us to address these
commercial opportunities, but also maintain our balance sheet
during the lawsuit against Samsung as a fully operational business,
rather than as an IP shell. It also adds stability to the business
and allows us to retain the extensive experience and skills of our
smaller focused team. The support of our Major Shareholders is very
welcome and the Loan Notes will maximise our chances of delivering
significant organic value and litigation upside value to all
shareholders from the expected commercial and litigation success in
the coming years."
- Ends -
For further information, please contact:
Nanoco Group PLC : +44 (0) 161 603 7900
Brian Tenner, CEO
Liam Gray, Company Secretary
Caroline Watson, Investor Relations Manager
cwatson@nanocotechnologies.com
Peel Hunt (Corporate Broker):
Edward Knight +44 (0) 207 418 8900
Nick Prowting
MHP Communications : +44 (0) 203 128 8788
Reg Hoare
Giles Robinson
Pete Lambie
nanoco@mhpc.com
The person responsible for arranging for the release of this
announcement on behalf of Nanoco is Liam Gray, Company
Secretary.
MAR
The information contained within this announcement is considered
by the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014. Upon the publication
of this announcement via a Regulatory Information Service, this
inside information will be considered to be in the public
domain.
FORWARD LOOKING STATEMENTS
This announcement (including information incorporated by
reference in this announcement) and other information published by
Nanoco may contain statements about Nanoco that are or may be
deemed to be forward looking statements. Such statements are
prospective in nature. All statements other than historical
statements of facts may be forward looking statements. Without
limitation, statements containing the words "targets", "plans",
"believes", "expects", "aims", "intends", "will", "may",
"anticipates", "estimates", "projects" or "considers" or other
similar words may be forward looking statements.
Forward looking statements inherently contain risks and
uncertainties as they relate to events or circumstances in the
future. Important factors such as business or economic cycles, the
terms and conditions of Nanoco's financing arrangements, tax rates,
or increased competition may cause Nanoco's actual financial
results, performance or achievements to differ materially from any
forward looking statements. Due to such uncertainties and risks,
readers are cautioned not to place undue reliance on such forward
looking statements, which speak only as of the date hereof. Nanoco
disclaims any obligation to update any forward looking or other
statements contained herein, except as required by applicable
law.
Notes for editors:
About Nanoco Group plc
Nanoco (LSE: NANO) harnesses the power of nano-materials.
Nano-materials are materials with dimensions typically in the range
1 - 100 nm. Nano-materials have a range of useful properties,
including optical and electronic. Quantum dots are a subclass of
nano-material that have size-dependent optical and electronic
properties. The Group produces quantum dots. Within the sphere of
quantum dots, the Group exploits different characteristics of the
quantum dots to target different performance criteria that are
attractive to specific markets or end-user applications such as the
Display and Electronics markets. One of the interesting properties
of quantum dots is photoluminescence: the emission of longer
wavelength light upon excitation by light of a shorter wavelength.
The colour of light emitted depends on the particle size. Nanoco's
CFQD(R) quantum dots are free of cadmium and other toxic heavy
metals and can be tuned to emit light at different wavelengths
across the visible and infrared spectrum, rendering them useful for
a wide range of applications including displays, lighting and
biological imaging.
Nanoco was founded in 2001 and is headquartered in Manchester,
UK, with a US subsidiary, Nanoco Inc., in Concord, MA. Nanoco
continues to build out a world-class, patent-protected IP portfolio
generated both by its own innovation engine, as well as through
acquisition.
Nanoco is listed on the Main Market of the London Stock Exchange
and trades under the ticker symbol NANO. For further information
please visit: www.nanocotechnologies.com .
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END
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