LONDON: NetScientific Plc (AIM: NSCI) announced that its portfolio company ProAxsis Limited has successfully closed a c.£1.8 million investment.
The investment was led by the Company’s wholly owned venture capital and corporate finance firm, EMV Capital, syndicated from a cohort of private investors.
The Investment includes c.£211,000 from new investors, c.£36,000 from the exercise of warrants (Warrants) granted to existing investors in connection with convertible loan notes (CLNs), the conversion of the CLNs (and interest thereon) valued in total at c.£455,000, and the conversion of loans from NetScientific valued at c.£776,000.
This additional funding is complemented by ongoing non-dilutive funding from, amongst other grants awarded, a recent c.£333,000 grant from Innovate UK.
In addition to the Investment, ProAxsis has provided for up to a further £289,000 to be raised on the same terms as the existing new investors in the Preferred Shares (Follow-on Investment).
Following the Investment, the Company’s direct stake in ProAxsis is 90.66 per cent, which equates to a post-investment fair value of c.£8.0 million, an increase of c.229 per cent. from the £3.5 million reported as at 30 September 2023. In addition, following the introduction of investors by EMV Capital, the NetScientific capital under advisory with ProAxsis is 8.81% of the fully diluted share capital.
The proceeds of the Investment (and any Follow-on Investment) will, inter alia, support ProAxsis in the development of its Patient Point of Care product range, and its working capital requirements, as well as its endeavours to attract strategic partners.
Dr Ilian Iliev, CEO of NetScientific, and Investor Director of ProAxsis said: “We welcome this additional funding for ProAxsis. Complemented by the CLNs and Innovate UK grant, these investments demonstrate strong financial support as ProAxsis develops its offering to the respiratory disease market, whilst it explores options for a potential sale to a new strategic owner.
“EMV Capital securing this third party funding is a further example of our capital efficient investment model, allowing ProAxsis to grow without reliance upon the NetScientific balance sheet.”