News Column

Broca Conditionally Raises GBP8.5 Million, Proposes Reverse Takeover Deal

July 17, 2014

Samuel Agini

LONDON (Alliance News) - Broca PLC Thursday said it has placed new shares to raise GBP8.5 million before expenses, as part of a proposed reverse takeover deal with MXC Capital Advisory LLP.

MXC Capital Advisory is a specialist technology corporate finance advisory business which is authorised and regulated by the UK Financial Conduct Authority and owned by MXC Capital.

Broca said it conditionally raised the funds by placing 850.0 million shares at 1 pence each. The placing price represents a 32% discount to the closing mid-market price of 1.475p on Wednesday.

Broca shares are suspended from trading on AIM as a result of the reverse takeover proposal. They were last quoted at 1.30p.

The new shares will represent a 68.16% stake in the business. Chairman Ian Smith is subscribing for 13.0 million shares, or 1.04% stake. Smith is joined by Non-Executive Director Simon Duckworth and his wife, Caroline Duckworth, who are subscribing for 5.0 million shares.

MXC Capital is set to subscribe for 300.0 million shares. Smith is a director of both companies.

Hedge fund Helium Special Situations Fund is proposing to subscribe for 20.0 million placing shares, while Nigel Wray, a shareholder in Broca, is proposing to subscribe for 300.0 million shares.

Broca said that it will become an investment and advisory business if the placing and reverse takeover are approved by shareholders. It will seek to generate shareholder returns by making significant minority investments in growth technology businesses while supporting them with advisory services.

Broca said it will have a merchant banking ethos of shared risk and reward with investee companies; a focus on the technology, media and telecommunications sector; and a corporate finance advisory practice. It said that MXC Capital will act as a consultant to the company, with the task of introducing suitable investment opportunities.

Broca has been an investing company under AIM rules after disposing of its operating business in April.

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Source: Alliance News

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