Member Info for PiratePete

Troublesome - Transformational to the Nanoco Deferred Bonus Scheme and LTIP!!

Nanoco first signalled its intention to return significant funds to shareholders on 3 February 2023 when the final settlement agreement was signed with Samsung. The second tranche of the agreement was received on 24 January and on 11 March, the board determined a tender offer up to £30m and a £3m share buyback was the most appropriate means to return value and provide flexibility to shareholders. The tender offer is at a fixed 24p per share, representing a premium of 25.1% to the 8 March closing price and 19.6% to the 60-day VWAP. It covers up to 38.5% of issued capital, with Nanoco potentially acquiring a further 3.9% through the share buyback (assumed at the tender price). If a material portion of the £33m is not returned via these mechanisms, Nanoco may consider a special dividend. The tender offer is subject to shareholder approval at a general meeting on 28 March. Following completion of the £33m return and repaying c £5m of outstanding debt, management expects to retain £23m cash to: ◼ Invest in the group’s production capability to enhance efficiencies and support gross margin expansion. ◼ Build and fit out the new 300mm wafer device facility (see our previous note). ◼ Develop new second and further generation sensing materials. ◼ Self-fund the early stages of its IP portfolio licensing programme, to support overall commercial objectives and mitigate potential downsides to returns from utilising licensing agents or third-party funding. ◼ Fund commercial activities until the company is self-financing (management expects this in CY25). We have previously stated that the group would need to generate over £8m in sales from products and services, assuming a modest 70% gross margin and minimal capex to generate free cash flow. After fulfilling initial commercial orders for two new materials and with more nanomaterial projects underway, we believe the group is well-positioned for growth.

78 pct saying “No”

Nanoco on Twitter patting themselves on the back for doing such a great job!! Deluded!!

“ ard’s confidence it will become self-financing during 2025 Nanoco’s market value presently stands at only a c.10% premium to the final litigation cash proceeds. Recognising that the Group retains carried forward losses well in excess of £30m (having already utilised £10m) to minimise the tax liability from the settlement, it remains surprising that the market continues to price in so very little for the Board’s stated expectation that it will become a self-financing producer of high performing nanomaterials during CY2025. “

This comes as no surprise to me!!!

Kooba - You are absolutely correct - I completely misread that. Apologies to everyone for my mistake. If you are on the register on 9 April you can tender your shares.

Flying higher - If you buy shares today they won’t qualify for the tender!

Gino - I am not making any predictions - I am just pointing out that a mechanism will exist for Nanoco to accept individual tenders of more than 38.5 pct (in the event that other shareholders tender less than 38.5 pct). Hope that clarifies my point adequately?

Gino dog - I believe that the following excerpt answers your question.

· Tenders in excess of a Shareholder's Basic Entitlement will only be accepted to the extent that other Shareholders tender less than their Basic Entitlement or do not tender any Ordinary Shares and, if necessary, excess demand will be scaled back on a pro rata basis (save that tenders from Shareholders who hold 2,000 Ordinary Shares or less will be accepted in full subject to there being capacity to purchase those Ordinary Shares in accordance with the terms of the Tender Offer).

Snouts in the trough!!!

This is what they are really worried about - Resolution 2 seeks authority to approve an amendment to the rules of the Nanoco 2015 Long Term Incentive Plan (the "LTIP") and the Nanoco 2015 Deferred Bonus Plan (the "DBP"), which were originally approved by shareholders at the 2015 Annual General Meeting, and subsequently amended at the 2021 Annual General meeting. Awards under the LTIP and the DBP are subject to a combined limit of exercised and outstanding options at any point in time being less than 10 per cent. of the issued share capital at that point in time. The cancellation of approximately 90 per cent. of the Ordinary Shares acquired as part of the Return of Value will have a disproportionate impact on this limit. The Board does not consider that employees should be penalised as a result of the Return of Value which is beneficial to Shareholders. Therefore, in order to be able to continue to issue options under the LTIP and the DBP, Shareholders are being asked to approve an amendment to the rules of the LTIP and DBP to allow shares held in the Nanoco Employee Benefit Trust to be excluded in assessing the 10 per cent. limit.

Too little - too late!!

Pleased it is a tender offer rather than divi - disappoint that it is right at the bottom of the return of capital range mentioned in previous RNSs. Nanoco never fails to disappoint!!

According to a Kooba post on the other board Lombard Odier also have a significant holding in IQE (just under 15 pct). Who’d have thunk it!

Kooba - Nanoco management are focussing on the important stuff (posting about International Women’s Day on Twitter). When they get some free time they might just have a look further down their ‘to do’ list at the much less important business of returning capital to shareholders!!

Richard Griffiths tripled his holding in IQE

There was a boost for IQE last week as 'Welsh wizard' Richard Griffiths tripled his holding in the semiconductor firm to 7.6 per cent.

The former sheep farmer is known for his success in backing firms such as Nanoco, GVC and Oxford Nanopore Technologies.

Maybe his latest move will work some magic on IQE's share price, which has yet to recover from a plunge a year ago.

Just two of the lorry loads of equipment arriving on site at Runcorn for our new semi-conductor device facility. Great commitment by the team coming in over the weekend to get it all moved into our new space. Once commissioned by our new Device Team, we will have an unparalleled device capability.

“Grow up Ryan, he's the CEO show some self respect and professionalism.. If you have issues contact corporate coms.”

If anyone needs to demonstrate professionalism it’s the (very amateur) Nanoco management!

P.S. Have you ever received a response from Nanoco corporate communications? No - me neither!!

Here is the piece for those that are interested “ Responding to today’s Budget, Brian Tenner, Chief Executive Officer, said:

“Jeremy Hunt’s ‘Budget for Long Term Growth’ set out some encouraging developments for the UK’s most innovative technology companies. The continuation of the Treasury’s full expensing policy will act as critical relief for companies seeking to invest in growth, especially businesses who will require significant capital expenditure in developing and manufacturing cutting edge materials.

We’re equally glad to see new tax reliefs and investments for the UK’s growing advanced manufacturing industry, as well as the renewed commitment to the Government’s levelling up agenda; supporting technology and science across the breadth of the UK’s regions and nations, including here in Runcorn”.

Nanoco’s Brian Tenner is on Twitter commenting on the budget’s impact on tech companies. I suggested that investors are more interested in receiving an RNS about the return of capital.