(Sharecast News) - Shares in sustainable fuels technology developer Velocys were plunging on Tuesday after it updated the market on its funding plans.
The AIM-traded company announced on 21 September that the longstop date for the convertible loan notes (CLN) transaction, initially detailed on 18 May, had been extended to 31 October.
That extension was contingent on certain conditions, including a commitment by Carbon Direct Capital to invest $15m via the convertible loan notes, subject to a minimum aggregate raise of $40m.
It confirmed on Tuesday that those conditions had not been met.
The board said that, despite ongoing active funding discussions with strategic investors conducting due diligence for several months, it had determined that any investment resulting from the discussions was unlikely to mirror the terms of the previously announced convertible loan note.
As a result, there would be no further extension to the longstop date, and there were now no binding arrangements for funding in place.
"As detailed in its recent interim results, Velocys still anticipates that funding will be required before the end of this calendar year and therefore the board is prudently exploring near-term funding options as discussions with the strategic investors continue," the Velocys board explained.
"Further updates will be provided in due course."
At 0822 BST, shares in Velocys were down 58.31% at 0.42p.
Reporting by Josh White for Sharecast.com.
