Nektan announces fourth extension to fundraising drive

21 October 2019

White label and gaming content provider Nektan has extended the deadline for orders for a placing to raise £3.0m (€3.5m/$3.9m) in working capital for the fourth time, after revealing that certain parties were proposing “unacceptable” terms in return for investment.

The supplier aims to raise the money through an equity placement of ordinary shares, and had suggested that it would surpass its £3.0m target to ultimately raise £5.0m. This saw the placement deadline extended from 25 September to 2 October, then 9 October, before being pushed back to 18 October.

However, negotiations with investors revealed that interested parties were proposing terms “unacceptable” to the board, resulting in these groups being excluded from the placing.

Nektan added that it remains in discussions with other investors as it looks to hit its original £3.0m target. The business previously suggested that this funding was needed to ensure the business could continue as a growing concern. This, it said when the placement was first announced, could come through alternative sources, or through asset sales.

As a result, the placing will remain open for orders until 5:00PM on 24 October, though the board reserves the right to close it earlier should sufficient funds be raised.

Nektan’s efforts to continue trading has also seen it renegotiate the terms of its Series A and B convertible loan notes (CLNs), converting the Series A to ordinary shares, and extending the repayment deadline on Series B.

It has also agreed to defer redemption dates of loans provided by executive director Gary Shaw and Venture Tech Assets (VTA), a company connected to Nektan’s non-executive director Sandeep Reddy.

Shares in Nektan plc are trading at 5.75 pence per share Monday morning, having fallen 74.44% in value over the past year.