(Alliance News) - Applied Graphene Materials PLC shares dropped on Wednesday, after it said it will initiate a strategic review to address a funding crunch.
Shares in the Cleveland, England-based graphene materials maker were down 29% to 3.50 pence each in London on Wednesday morning. The stock is down 87% in the past 12 months.
Earlier this month, Applied Graphene shares plunged, after the company warned it could run out of cash, but said an equity raise wasn't possible at the time. The company attributed this to unfavourable conditions in small-cap equity markets.
Applied Graphene will need additional funding to extend its cash runway beyond this coming January 31 - less than three months away - by which point its current financial resources will be depleted.
On Wednesday, Applied Graphene said it has decided to initiate a strategic review, where the board will consider options available to maximise value for company's shareholders.
"Such options could include, but not be limited to, raising additional funding from a specialist debt provider or strategic investor or by realising value from an accelerated sale of the group's trade and assets or of the shares in the group's main operating subsidiary," the company noted.
In the event the strategic review does not achieve a satisfactory conclusion, Applied Graphene said it will commence statutory redundancy consultations with its employees.
The board has appointed Alvarez & Marsal Europe LLP as its financial adviser to manage the strategic review.
By Sophie Rose; sophierose@alliancenews.com
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