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We know that the decision to make a sale offer was based on agreed commitment to shareholders’ best interests - presumably those doing most of the funding over the years. Sale motivation might make sense if an suggested offer had already been put to Nanoco, pre-sale, and the main funders saw some value in this - rather than sale just about having doubts for the future. Apart from that, listening to Blackberry CEO it seems in the tech world lots of firms are working together - connecting here and there - and not just always competing. Speculation, of course.
Hi nano
From RNS 5th Nov
"Formal Sale Process as Part of Strategic Review
In its preliminary results announcement on 16 October 2019, the Board of Nanoco Group PLC ("Nanoco" or the "Company") (LSE: NANO) reiterated its focus on maximising value for shareholders. In this context, the Company confirms that it has entered into preliminary discussions with certain parties about a potential sale of the Company. Accordingly, the Company today announces that it is undertaking a review of all the strategic options for the Company, including, but not limited to, a potential sale of the Company through the commencement of a "formal sale process", as referred to in Note 2 on Rule 2.6 of the Code."
ie For Sale since 5th Nov but already "discussions with certain parties about a potential sale of the Company."
BoL
The wording gives little away, like most Nano statements. It doesn't say, for instance, that Nano were approached regarding a sale, they may have just started ringing around everyone they know, and it would still pass the "entering into discussions with certain parties" definition, as would virtually any other interpretation.
Hi BBD
I agree the wording doesn't say much, but cannot believe that they started ringing around. Would that not be a bit unethical for a CEO? Also it says parties (more than one), so I assume they were contacted by 2 (or more) companies, then decided to go all in. Then, "a review of all the strategic options for the Company, including, but not limited to, a potential sale of the Company".
Don't think they need to raise any more cash for at least a year and should get that easily (from Loam), and all the strategic options infers 2 or more - mergers etc, infers they are not desperate for a Deal at all, so again hardly driven to ringing around.
Maybe I'm reading too much into it, but this is basically what I thought when I first saw the RNS. No need to sell so must have been approached.
BoL
The sale option is embedded within the strategic review of options which is needed because they lost their only source of revenue. So if "No need to sell" is the only reason to "assume they were contacted", it's a pretty flimsy one: the need is implicit in the review.
A company running out of money with very little revenue has good reason to seek out buyers, arguably a much stronger reason to assume that it was Nano who initiated the sale talk, and why would that be unethical - it's surely just part of seeking to maximise returns for shareholders, as stated in the announcement of the review when the idea of a sale was first mentioned.
CEO’s speak to each other regularly and mergers and acquisition is part of business, so certainly not unethical. I suspect Nige just used the wrong terminology in his post.
I am more than comfortable with the Strategic Review approach taken by the Board at this stage, when it has just banked the last contractual payment from the US partner (prob Apple) and before the cash burn guarantees a fire sale. If the process does not secure a decent premium it should generate awareness if not an order. If not, I cannot see that NANO is a viable ongoing concern. We shall find out which very soon and perhaps even next week and my money is on a positive outcome.
"it says parties (more than one), so I assume they were contacted by 2 (or more) companies,"
"Certain parties" only establishes that the amount is more than zero. Some might say your choice of assumptions are based more on wishful thinking than logic, not me though ( :
I suspect that Nanoco will claim a high price for the following reasons:
(1) The quantum dot market is gigantic and continuing to grow.
(2) Many basic patents already exist.
(3) Anyone entering the field at this time is likely going to face many legal battles..
(4) Nanoco's 750 patents offer safe harbor, product opportunity, and licensing revenue.
(5) Companies with sufficient financial resources could reap huge benefits with relatively low investment.
One of main problems is nanoco has so many different areas. Harder to sell many areas than focus on one such as nanosys. Even nanosys do not bother with mobiles or tablets, just tv display. Nanoco specializes in Display, qd dots micro led, growth lights, vertical farming, car sensors, cancer detection. Medical, automotive, display, endless list of applications. Dow, Merck, wah hong will have to deal with new owners. Maybe nanoco will keep the medical side.
What would Apple do with cancer detection patents???
Hi jplay,
What about this article a few years ago regarding Apple having ambitious plans for integrating smartphones in the medical field. An i-phone powered lab that can detect cancer with 99% accuracy :-
https://9to5mac.com/2016/10/22/iphone-powered-lab-that-detects-cancer/
totally agree....but 18-20p would be a high price rom here?
The problem with that theory is, if they pay much more than 30-40% premium to the SP... Whoever "they" are, will not see it as VALUE....
As investors, we do not possess sufficient information or expertise to value Nanoco's intellectual property objectively. Consequently, we either have to sit it out and see what emerges from the protracted (my view) bi- process, or else sell up in case there is no agreement - in which case the share price will tumble.