Member Info for DRB83

Very last one now.

Reverse takeover you say.

What Is a Reverse Takeover (RTO)?
A reverse takeover (RTO) is a process whereby private companies can become publicly traded companies without going through an initial public offering (IPO).

To begin, a private company buys enough shares to control a publicly-traded company.

Now control is the important word. Huey, I know you don't think % means anything in business but do you know what % is needed to gain control?

Secondly, it was Novacyt giving shares to Lab21. Usually it is the buyer that gives shares/cash to the seller.

This combination of companies doesn't seem to tick the reverse takeover boxes either.

I know you don't like Google but you really need to start using it. You'll learn loads before embarrassing yourself on here.

Lab21 acquisition - put to bed
Lab 21 closure - put to bed
Me - going to bed

Ok. One last go.

Logic would tell me that the combined company was worth €40m. Novacyt gave 46% away to Lab21 so they theoretically paid €18.4m. in my world.

This was share for share so no cash was involved. A placing of €3.1m is for cash as they would have been running low on cash. Completely unrelated so no I don't find it funny.

How long have you been investing as you appear to know very little about this stuff. You could learn alot from this and other bb's. You just have to listen.

Wow. Is this guy serious. I'm out.

Huey, peruse at your leisure but I have attached an RNS that happened a few months after the deal between Novacyt and Lab 21

https://novacyt.com/novacyt-announces-a-e3-1m-capital-raise-and-prepares-for-new-market-launches/

To help you out I have pasted a couple of extracts:

The fundraising builds on a strong year for Novacyt following its acquisition of UK diagnostics
specialist Lab21

Graham Mullis, Group CEO of Novacyt, commented:
“While it is only five months since the merger between Novacyt and Lab21

They can't seem to decide whether it's a Novacyt acquisition or a merger but one thing for sure is it's not a Lab21 acquisition.

Last one

Under the terms of the deal, about 2.5 million shares of Paris-based Novacyt will be issued to Lab21 shareholders at an exchange ratio of .925 Novacyt shares for one Lab21 share.

Novacyt shares being issued to Lab21 shareholders is a pretty clear indication.
https://www.genomeweb.com/pcrsample-prep/lab21-novacyt-combine-341m-stock-stock-deal#.YwAfDynTVio

Oh and I didn't say Novacyt paid £40m for Lab21. Neither does the article. You're reading but not understanding. Do you have a business background or are you self taught?

No one cares about company names, lol. I guess Lab21 shareholders didn't care that they only got 46% of the business Vs Novacyts 54%. That doesn't matter either.

Simple question, why was the takeover subject to a Novacyt shareholder vote and not a Lab21 shareholder vote.
Answer, because your shareholders have a vote on been taken over, shareholders do not vote on acquiring.

It was a merger. Ncyt was a listed company. The shareholders were now going to be owning 54% of Novacyt Group instead of 100% of Novacyt. That warrants a vote.

Lab21 weren't listed. There biggest shareholders had already given their backing.

Lab21’s backers, which include Clydesdale Bank and Medicis Capital, have already thrown their support behind the deal

I don't enjoy ridiculing people on here Huey but you are really making it hard for me tonight.

In April 2022, the Company concluded

a review of its Lab21 Healthcare and

Microgen Bioproducts® businesses.
The review confirmed that the costs
associated with updating the existing
portfolios in these businesses to comply
with IVDR and ISO regulations are
prohibitive versus the sales opportunity it
presents. Therefore, Novacyt is proposing
to discontinue both businesses, which
will be treated as discontinued under IFRS
5 for 2022 accounting

Just to wrap up the confusion around what discontinuing means according to IFRS5

Key provisions of IFRS 5 relating to discontinued operations
Classification as discontinuing
A discontinued operation is a component of an entity that either has been disposed of or is classified as held for sale, and: [IFRS 5.32]

represents either a separate major line of business or a geographical area of operations
is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations,
or is a subsidiary acquired exclusively with a view to resale and the disposal involves loss of control.

Lab21 was loss making. It's catalogue has been dramatically reduced. R&D has most likely been significantly scaled back. They had 45 employees. Do you still think 45 are needed. Lab technicians, sales reps, middle managers will be made redundant.

Some products will be kept, some people will be kept and moved over to Novacyt. I don't know the layout of Unit 1 but I suspect that if lab utilisation has been dramatically reduced along with office utilisation then Novacyt may be looking to relocate to another more suitable HQ. If so then this would be factored into restructure costs and also future savings of £2m.

Ncyt aren't treating this as a rebranding. They're not just keeping all employees and sewing a new logo on their smocks. Wake up.

A statement from the annual accounts:

A cash restructuring charge of
circa £0.5 million is expected; however,
this should be fully financed from in-year
savings and the release of working capital
to make the closure of the businesses
cash neutral in 2022.

Make the CLOSURE of the businesses.

They are CLOSING. Ncyt have told you. I'm not sure if you are one of the 45 employees at Lab21 Huey and are therefore in denial but please get on the same page as the company. It's draining.

Anyway, all of this distracts from the original debate which was your fascination of calling this discontinuing of operations a simple rebranding.

You still haven't answered my questions:

Why would a rebranding result in the loss of all sales from Lab21?
Where is DA getting is £2m of savings?
What is the £500k restructuring costs?

Your comment earlier:
I'm tempted to say that a chunk of costs will relate to changes to financial reporting from Ltd to Plc. But...

That's a little embarrassing for you there.

Huey, so your basing your conclusion that Lab21 took over Novacyt on 2 things:

1. Graham Mullis who was CEO of Lab21 became the new CEO of the "new company" that just happened to be called Novacyt Group.
2. Because Novacyt just wouldn't want to buy a Venture Capitalist

That's it. So you've decided to ignore that:
1. The company is now called Novacyt Group not Lab21 Group.
The group will take on a new identity to reflect the fact that neither company is exactly buying the other.

They must have changed their mind as Novacyt Group sounds a hell of a lot like Novacyt

2. Lab21 is a 100% subsidiary of Novacyt Group.
If they say yes – Mr Mullis is “very confident” that they will – Lab21 will become a 100% subsidiary of Novacyt.

3. Novacyt shareholders are the majority holders, Lab21 shareholders are the minority holders.
Technically it is Novacyt that will acquire Lab21, issuing 2,523,059 new shares to Lab21 investors, resulting in 54% of the new entity being held by Novacyt’s current shareholders.

In terms of your 2 points above.

1. As the 2 companies merged could it be possible that it was agreed as part of the deal that GM would become CEO. For all we know it could have been a clincher. It's as simple as that. That one event does not mean Lab21 must have bought Novacyt.

2. You may be getting mixed up with the kind of VC that have their hands in all sorts of industries and products, almost like a conglomerate. Lab21 as far as I can see were very specific in their acquisitions. They were all related and all very much in the same industry as Novacyt. You ask why would Novacyt want to buy Lab21?

Novacyt has contributed substantial R&D, which is what we’ve been looking for, and Lab21 contributes commercial and manufacturing assets and knowhow. It’s a very nice combination.” Mullis said.

Manufacturing.and knowhow. There you go. Not to mention a foothold into the UK market. The acquisition or merger whatever it was made sense for both companies. It certainly wasn't a Lab21 buy out of Novacyt.

Come on now stop being silly.

Extract from article I kindly provided to help you:

Technically it is Novacyt that will acquire Lab21, issuing 2,523,059 new shares to Lab21 investors, resulting in 54% of the new entity being held by Novacyt’s current shareholders.

From the man himself:

Mr Mullis insists that the deal is not a takeover. “It is more a merger of equals. Novacyt has contributed substantial R&D, which is what we’ve been looking for, and Lab21 contributes commercial and manufacturing assets and knowhow. It’s a very nice combination.”

This kind of merger is a new type of move for Lab21, which usually prefers to buy, Mr Mullis says. “Historically we’ve made acquisitions of products and assets – we’ve never really invested heavily in R&D ourselves.” The group will take on a new identity to reflect the fact that neither company is exactly buying the other.

I shouldn't really have to spoon feed you this stuff.

"I'm tempted to say that a chunk of costs will relate to changes to financial reporting from Ltd to Plc. But..."

Wow. You do realise Lab21 have been part of a plc since Novacyt acquired them. It's called group accounting. Now they are being discontinued there will be zero accounts to be filed for Lab21. Lab21 no longer exists.

Any answer on why the reduction in £2.9m sales? Or the £2m savings?

How have you survived this long?

https://www.evaluate.com/node/6343/amp

https://www.unquote.com/uk/official-record/89404/vc-backed-lab21-sold-to-novacyt

No. It was a combination of which Lab21 became a sub of Novacyt. It was a share for share transaction

You still haven't answered my questions.

Huey, so much to unpick there I'm not sure if you're being serious.

Where is Lab21 based?
Where is Primer Design based?
If it is just a paper exercise in closing the business and rebranding under a new name then please highlight where the £2m savings are coming from?
What is costing us £500k to restructure?
Why are we going to be losing £2.9m sales?

Nothing in your middle paragraph makes sense.

The Microgen/Lab21 numbers are in the Novacyt annual accounts. Surely you knew that.

Agreed, the jdw business model of being constantly highly leveraged was working under normal circumstances. No one saw a 2 year pandemic followed by European war. The balance sheet is Uber weak and the economic issues will for sure put significant strain on both the top line and the costs. The next set of results are critical and shareholders need to be reassured that jdw can navigate the next 12-24 months without triggering the loan covenants or requiring a placing. For now, the market is very nervous about jdw. What's happened to Cineworld won't have helped.

Everything has dried up.

Still waiting on the result of below investigation:

The Board understands that, following disposals totaling 157,500 shares between 22 June and 15 July 2022, and the unwinding of a facility agreement over 908,250 shares on 19 July 2022, Aaquaverse now holds shares totaling 11.57% of the current ordinary shares in issue. Since first being informed of the above changes in ownership on 20 July, the Board has sought to clarify the resultant beneficial interests as accurately and quickly as possible in order to provide an accurate summary to the market. All available information has now been disclosed.

The Northern Strategy is planned for 7,500t pa by CY23 Q2 with the rest by end of Dec23.

Johnny/Dribbles, thank you for following me round like a bad smell. I've clearly ruffled your feathers in the past. Moved on from you several months ago in which time you've been blocked and created upwards of 20 new users. I wonder if you will ever actually contribute anything to any BB but your clearly more interested in following people round insulting them. Pathetic. Speak again in another 20 users or several months. Lol

Lab21 had the lowest gross margin and was also loss making pre exceptionals so it could have just been a simple business move to improve the overall bottom line.