(Alliance News) - Velocys PLC on Monday said it received an indicative offer from a consortium of firms, but still has no much-needed binding arrangements in place for short-term funding.
Shares in Velocys plummeted 61% to 0.27 pence each on Monday around noon in London.
The Oxford, England-based sustainable fuels technology company said the non-binding indicative all-cash takeover offer was from a consortium led by Lightrock LLP and Carbon Direct Capital Management LLC.
Velocys explained that the offer formed part of ongoing funding discussions with potential strategic investors, and includes the consortium's intention to "provide significant funding for the company to meet its long-term growth capital needs."
The takeover offer comprises 0.25 pence per share, valuing Velocys's share capital at around GBP4.1 million. This, Velocys said, represents a substantial discount to its current share price.
Velocys said it is also in discussions with the consortium regarding potential short-term funding. However, it said there are currently no binding arrangements in place regarding such funding with any parties.
Velocys said it continues to explore cash control and other measures to extend its runway. Nonetheless, it believes it is "unlikely" to be able to continue as a going concern beyond the end of 2023, if it does not obtain short-term funding or implement any "meaningful" strategic options by then.
By Emma Curzon, Alliance News reporter
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