LONDON (Alliance News) - ViaLogy PLC Tuesday said it will spin out its energy services business into a new US-based company, allowing it to focus on other technologies it has developed and to reduce its working capital requirements as it considers new funding opportunities.
The energy services business is headquartered in California and provides seismic data analysis to more accurately detect oil and gas deposits for clients around the world, but Vialogy UK manages its finance and administration. It will now be spun out as a US incorporated company called ViaLogy Energy Corp, with ViaLogy PLC taking a 75% stake and the rest owned by founder Sandeep Gulati and two key members of the energy services technical team. Costs of the operations will be fully borne by the new US company, while the UK company will consolidate its share of revenues.
"The directors believe that this restructuring will better facilitate funding and the introduction of additional expertise to exploit the opportunities presented in the oil and gas services business; reduce ViaLogy PLC's overall working capital requirements as it considers funding opportunities, as well as open new markets to the company," it said in a statement.
The move comes after ViaLogy PLC started to review options to try and fully realize the commercial potential of its Quantum Resonance Interferometry technology, which identifies and interprets ultra-weak signals, and to develop new funding partnerships to help it grow.
It is trying to license the QRI technology in areas including mining, pharmaceuticals, security and surveilance.
ViaLogy Energy Corp is already in talks with a number of US companies and existing clients about funding. A deal could mean ViaLogy PLC's stake could be diluted, it warned, although it retains the right to participate in any funding round.
ViaLogy shares were down 19.1% at 0.586 pence Tuesday morning.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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