SWC.L Regulatory News (SWC)

21 September 2021

Summerway Capital Plc

("Summerway" or the "Company")

Proposed amendment to Investing Policy

Directorate Changes

Suspension of Trading

Change in Nominated Adviser and Broker

The Board of Directors of Summerway Capital Plc (AIM: SWC) today announces a proposed amendment to its Investing Policy and a number of Directorate Changes.

Background to the proposed amendment to Investing Policy and Directorate Changes

Since January 2021, the Directors have explored a number of investment and acquisition opportunities in line with the Company's investing strategy across the software, Software-as-a-Service ("SaaS") and digital technologies and services sectors. During this time, certain other sector opportunities have presented themselves to the Directors, which whilst outside of the Company's current investing policy, the Directors consider to be attractive options for the Company's existing Shareholders, many of which invested at the Company's original AIM Admission.

The Company has been presented with opportunities in the healthcare and pharmaceutical sector, which, should the Company's Shareholders support, would necessitate an amendment to its current investing policy.

As a result of this contemplated move away from the technology sector, the Company announces that Chair Vin Murria OBE has resigned from the Board of Summerway along with Non-executive Directors Paul Gibson and Tony Morris. Ms Murria has provided an irrevocable undertaking to support the proposed amendment to the Investing Policy, and pursuant to Ms Murria's resignation, the warrant instrument entered into between the Company and Ms Murria will remain unexercised and lapse, and Ms Murria's Subsidiary Incentive Scheme B shares shall be bought back by the Company at their original subscription value, along with 50,000 of Mr Morris' 175,000 Subsidiary Incentive Scheme B shares on the same basis.

In line with the proposed amendment to the Investing Policy, Elizabeth ("Liz") Shanahan has joined the Board as a new independent Non-executive Director of the Company. As set out below, Ms Shanahan has significant experience in the healthcare sector and the directors believe her background and contacts will greatly assist the Company in assessing opportunities.

The Company's continuing directors, Benjamin Shaw (Non-executive Director) and David Firth (Independent Non-executive Director) consider it in the best interests of the Company's Shareholders to pursue a change in the strategic direction of the Company through amending its Investing Policy, and will be recommending this to Shareholders. The Company will be seeking signed irrevocables from certain Shareholders of the Company to vote in favour of the proposed amendment to its Investing Policy.

Directorate Changes

In line with the proposed amendment to Investing Policy and resignations of Chair Vin Murria OBE, and Non-executive Directors Paul Gibson and Tony Morris, the Company today also announces the appointment of Elizabeth ("Liz") Shanahan as independent Non-executive Director of the Company.

Ms Shanahan is currently a non-executive director of AIM-listed Inspiration Healthcare Group plc and a former non-executive director of UDG Healthcare plc, a company that was listed on the London Stock Exchange and a constituent of the FTSE 250 up until its £2.8 billion acquisition, which completed in August 2021.

Ms Shanahan is a life sciences entrepreneur with extensive experience advising leading global pharmaceutical and healthcare organisations on their communications. Until 2014, she was Global Head of Healthcare & Lifesciences at the NYSE-listed management consultancy, FTI Consulting Inc., who had in 2007 acquired the communications business, Santé Communications, which she founded in 1995. Ms Shanahan is a Trustee of CW+, the charitable arm of Chelsea & Westminster Foundation Trust Hospital in London and a member of the organisation's Innovations Advisory Board. Other than that set out below, there is no further information required to be disclosed under Rule 17 and Schedule Two, paragraph (g) of the AIM Rules.

In conjunction with the Directorate Changes, Benjamin Shaw, an existing director of the Company will assume the role of Interim Chairman. The Company's independent Non-executive Directors shall be David Firth and Ms Shanahan.

Suspension of Trading

The Company is currently in discussions with an immediate opportunity in the healthcare and pharmaceutical sector which it would pursue, subject to Shareholders supporting the change in policy as set out above (the "Proposed Transaction"). The Proposed Transaction will be classified as a reverse takeover pursuant to the AIM Rules and accordingly the Company's shares will be suspended from trading on AIM as of 1.30 pm today.

The Directors anticipate that following a change in Investment Policy being approved and satisfactory completion of due diligence, Summerway will finalise and enter into binding transaction documentation to acquire the target company. Summerway expects that the Proposed Transaction may be structured in two stages: firstly, Summerway will seek to make an equity bridge loan to the target company to allow it to immediately accelerate certain capital expenditures, before secondly completing the acquisition.

Completion of the Proposed Transaction will be subject to Summerway's Shareholders initially approving the Company's proposed amendment to its Investing Policy to allow the bridging loan to be advanced, and then Summerway Shareholders approving the acquisition and related matters at a further general meeting ("RTO General Meeting") to be convened in due course. In addition to approving the proposed acquisition at the RTO General Meeting, it is expected that Shareholders will also be asked to approve the issuance of new equity in the Company through an institutional placing and direct subscription to provide, amongst other things, funding for further capital expenditure and working capital for the enlarged group and the grant of a Rule 9 waiver by the Takeover Panel ("Rule 9 Waiver") in respect of the proposed issue of new shares to the shareholders of the target company and the admission of the share capital of the enlarged group to trading on AIM.

In order to convene the RTO General Meeting, the Company is required to publish an AIM Admission Document which will include, inter alia, information on the target acquisition and the terms of the Proposed Transaction. It is currently expected that, should the Proposed Transaction proceed, the AIM Admission Document will be published in the fourth quarter of 2021.

Shareholders should note that there can be no guarantee that final terms will be agreed for the Proposed Transaction which are acceptable to the Board of Directors of Summerway or at all. In the event the Proposed Transaction does not proceed, Summerway will explore further investment opportunities in the healthcare and pharmaceutical sector in line with its proposed revised investment policy. Further announcements will be made in due course.

Change in Nominated Adviser and Broker

As a result of the proposed amendment in Investing Policy of Summerway, the Company has appointed Canaccord Genuity Limited as its Nominated Adviser and sole broker with immediate effect.

This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) 596/2014 as amended by regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the publication of this announcement, this information is now considered to be in the public domain.

Enquiries:

Summerway Capital Plc

Tony Morris 020 7440 7520

Canaccord Genuity Limited (Nominated Adviser and Broker)

Andrew Potts 020 7523 8000

Additional Information

Elizabeth ("Liz") Shanahan, age 57, is currently or has been a director of the following companies within the past five years: