Member Info for TickTockCrock

What would the dilution to current shareholders have been if they sought the £3m from UK equity markets? Company only valued at £6m at time HOT announced. Also the £3m will get spent on R&D over next (guess) 2 years so structure has avoided the drag on profits in the group.

For those worried about dilution, this from ADVFN

Looking at the deal structure:

RUA retains 100% of Ordinary Shares

RUA has £4.8m CULS with 5% interest and conversion at 20% discount to next round.

Leducq has £3m CULS with 5% interest and conversion at 20% discount to next round.

Worst case is dilution is 3/7.8m to Leducq or 38%

If pre money valuation at next deal is say £50m, Leducq convers at £40m value and have approx. 8% and RUA the rest.

If pre money is £100m then Leducq have about 4%.

The downside has been protected for both RUA and Leducq but RUA is highly leveraged into growth in value.

News on the valve HOT must be due soon. If it is we might see if there are fireworks.

Not sure if it is value created to date but at the reorganisation in 2023, the HV assets were sold to RUA Structural heart for £3.1m and they have spent a further 1.4m since.. Even that is significant against the market cap.

Not saying AI is barking but it is certainly up the wrong tree.

RUA website updated on shareholders at 31 December. Hardly any change from June.

Not a bad last 12 months for RUA, slashed costs -£600k, Special project for global customer -£400k, turned into £3.3m over 5 years, Coloplast got them to buy Abiss for £68k getting 1.6m euro of assets. Abiss EBITDA adds 450k euro plus a year. This represents two major pieces of business from global device companies, the clearing out of the administrators saving £600k does not appear to have damaged customer confidence!

Search of Polish Companies House equivalent shows Abiss Poland with profits of Zl 512k or £100k. 60% owned by Abiss France. Purchase price covered by 1 years profit share from Poland, everything else for free.

Sam Smith, the RNS states that due to the nature of the transaction, detailed financial DD was precluded. It was an auction with the liquidator. The business survived 3 years of being owned by a liquidator of parent company so it must be robust financially. Main areas for DD are regulatory, product liability and customer/market related. It sounds like they were pretty well covered.

Abiss own 3 regulated products in Europe, It is very difficult to transfer ownership of a CE marked medical device, especially during the switch from MDD to MDR. The only deal that keeps Coloplast with a product was the purchase of the share capital. Without the support of Coloplast, all any buyer would get was an asset strip deal. Purchase priced as discounted asset strip for a going concern. Mid term what is done with IP will be interesting.

"The nature of the transaction has precluded an extensive financial due diligence process and post-acquisition a detailed financial forecast for the Abiss business will be developed. Based on discussions with Coloplast, the board is confident that there is continuing commitment to the Abiss products and there should not be any negative impact on RUA profitability as a result of the acquisition."

The above reads to me that until the financial model is produced they are giving no guidance on numbers from the acquisition, other than they will not be negative.

Wow!