Mindflair raises £0.49m through share placing
By Josh White
Date: Tuesday 24 Dec 2024
(Sharecast News) - Next-generation artificial intelligence specialist Mindflair announced on Tuesday that it has raised £0.49m through a share placing.
The AIM-traded company issued 81,666,666 new shares at a price of 0.6p each, representing an 11.1% discount to the closing price on 23 December.
Investors in the placing would also receive warrants, subject to shareholder approval at the next general meeting, enabling them to acquire additional shares under specific terms.
Alongside the placing, Mindflair said it had re-profiled its outstanding £1.235m loan notes, originally due for repayment in December.
The restructuring included the partial redemption of £0.19m in cash, and the conversion of £0.47m of loan principal and accrued interest into 78,238,798 new shares at 0.6p per share.
It said the terms of the warrants associated with the loan notes were also revised, with the exercise price lowered to 1.6p, the vesting hurdle reduced to 2.5p, and the exercise period extended to 31 December 2026.
The remaining balance of about £0.8m would be repaid in two equal installments by December 2025 and December 2026, providing the company with greater financial flexibility to continue its investment activities.
Mindflair said it undertook the placing and loan note restructuring as it prepared for the potential sale or liquidity events within its portfolio.
The first Sure Valley Ventures fund, SVV1, was in its realisation phase, with several companies actively pursuing sales or exploring alternative forms of liquidity.
It said the second fund, SVV2, was continuing to build its portfolio of AI-focused businesses, now comprising eight companies across sectors such as education, e-commerce, transport, and robotics.
Mindflair highlighted SVV's growing reputation as a thought leader in AI, with recent collaborations including a partnership with Imperial College London to commercialise AI research and an AI masterclass presented with Nvidia.
The loan note restructuring involved Riverfort Global Opportunities, a substantial shareholder in Mindflair, creating a related party transaction under the AIM rules.
Nicholas Lee, a director of Mindflair who is also the investment director of Riverfort, was excluded from the evaluation of the transaction.
An independent director, advised by Cairn Financial Advisers, concluded that the terms were fair and reasonable for Mindflair's shareholders, the board confirmed.
The new shares issued through the placing and loan note restructuring, totaling 159,905,464, were expected to be admitted to trading on AIM on 2 January.
Following the admission, Mindflair's total issued share capital would increase to 526,662,106 shares.
"We believe that the placing and re-profile is a good solution for all parties and provides the company with additional flexibility, notwithstanding the proximity of potential realisations from our portfolio," said director Nicholas Lee.
"We firmly believe that we are at a very exciting time in the development of the company."
At 1041 GMT, shares in Mindflair were down 10.89% at 0.6p.
Reporting by Josh White for Sharecast.com.
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