3rd Oct 2024 16:12
(Alliance News) - Nanoco Group PLC on Thursday said it has brought in advisers to help it consider the company's position following its European customer's decision to change its strategic focus away from quantum dot-enabled infra-red sensors.
The Runcorn, England-based developer and manufacturer of cadmium-free quantum dots and other nanomaterials said it would appoint CDX Advisors LLC to act as a financial adviser and review options for Nanoco's business and assets, including the potential for a sale of the trading business.
Nanoco is confident in its commercial potential, believing there to be applications for its technology over a range of markets. It said there were now more market participants using quantum dot display applications, that the absolute number of quantum dot-enabled units was growing, and that significant investments were being made by "global players" in micro-LED and electro-luminescent devices enabled by quantum dots.
As a result, Nanoco has been taking steps to rationalise the company's cost base, including a reduction in headcount, a reduction in the size of the board in financial 2025 and a reduction of non-critical operating costs. Directors will also take deferred payments of at least 50% until the end of the financial year at July 31 or the potential sale of the business.
These measures should reduce the group's annualised cost base by GBP2.6 million, or 34%, on a like-for-like basis, with an associated one-off cash restructuring cost of just over GBP100,000.
The company therefore believes it appropriate to commit to a return of surplus cash to shareholders during the course of financial 2025. It plans to return an initial sum of cash through a capital return following the release of its financial 2024 report and accounts.
Chair Chris Richards said: "Following our review, the board continues to believe in the inherent value and commercial potential of our technology, intellectual property and trading business. We have concluded that it is in the company's best interests to appoint CDX Advisors to review the options for the company's trading business, intellectual property and other assets, including the potential for a sale of the trading business and assets. The board is determined to deliver shareholder value as rapidly as possible. The board is therefore committed to a return of surplus cash to shareholders over the current financial year as and when it is prudent and advisable to do so."
Shares in Nanoco Group were up 6.3% at 13.11 pence each in London on Thursday afternoon.
By Emily Parsons, Alliance News reporter
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