(Alliance News) - Microsaic Systems PLC's stock price halved on Monday, as the shares of partner DeepVerge PLC were suspended from trading amid a failure to sell operations to raise much-needed funds.
The mass spectrometry equipment developer said DeepVerge owes it GBP1.35 million in unpaid invoices, and it will need to raise additional working capital in the third quarter if these are not paid.
Microsaic shares were down 51% to 0.011 pence in London on Monday morning. The stock is down 86% over the past 12 months.
Shares in environmental and life sciences company DeepVerge were suspended from trading on AIM on Monday, pending clarification of its financial position. Its shares were last quoted at 0.15p, having traded as high as 16.00p in the past year.
DeepVerge had been seeking to sell one or more of its business units in order to raise sufficient funds to allow it to continue to trade.
However, it failed to do so.
"Despite receiving indicative offers for both the Labskin (including Skin Trust Club and Rinocloud) and Modern Water businesses, in the voard's opinion none of these offers appears likely to reach a successful conclusion on a timely basis," DeepVerge said.
As a result, the company said it is unlikely that sufficient funds will be raised in time to allow its business units to continue to trade.
DeepVerge said it has taken the decision to no longer support the ongoing costs of these businesses. It is now seeking to realise "whatever value is possible" through the sale of one or more of its Labskin, Modern Water and Glanaco business units.
DeepVerge warned it expects this process will result in the sale, closure or administration of all its subsidiaries.
Microsaic said it has GBP650,000 in cash and no borrowings. It continues to meeting its obligations as they fall due and expects to release its 2022 results "later this week".
Despite the cash crunch, Microsaic remained upbeat.
"The directors believe that, after a slower start to the year, the company's growth plans and sales pipeline prospects offer a cautiously optimistic outlook, with the pipeline having grown substantially since the last update on 18 April 2023," it said.
The "speed and scale" of the conversion of that pipeline into revenue is uncertain, however, Microsaic said.
By Tom Waite, Alliance News editor
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Microsaic (MSYS)