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Elektron Technology has rejected all indicative offers and has ended the formal sales process in order to raise cash from a share issue.
Elektron wants to raise £3.5m via a placing and open offer but this has not been finalised as yet.
Fully listed Microgen had offered 5p a share for Elektron but that was rejected. Elektron did receive an offer which it says valued the company at 10p a share. Some larger shareholders, including executive chairman Keith Daley, did not want to accept this offer and because of the shortage of cash it would have been difficult to secure agreement in the time that Elektron has before its financial situation becomes more problematic.
At the end of January 2014, Elektron had headroom of £1.1m on its bank facilities but a weak May trading period means that the headroom has been reduced. Amended bank facilities will require at least £1m of headroom from the end of June 2014. The placing part of the fundraising could be secured by then. Existing investors could invest a further £2.3m in the placing at 5p a share. The open offer could raise up to £1.2m at the same share price, which is at a premium to the market price.
The share price perked up 0.25p to 4.5p, which values the existing share capital at £5.38m.
Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFJune2014_57.pdf
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