ATTRAQT
Group plc (AIM: ATQT), a provider of eCommerce visual merchandising,
site search and product recommendation technology to online retailers,
is pleased to announce that it has conditionally raised approximately
£3.3 million (before expenses) by way of a placing (“the Placing”) of
6,316,346 new ordinary shares of 1p each (the “Ordinary Shares”) at a
price of 52p per share (the “Placing Price”) with certain institutional
and other investors.
In
addition, 5,000,000 existing Ordinary Shares have been placed with
Azini 3 LLP (“Azini”) at the Placing Price (the “Share Sale”, together
with the Placing being the “Transaction”) to raise gross proceeds of
£2.6 million (before expenses) for Dan
Wagner (Chairman of the Company), Bright Station Ventures Limited, Alan
Docter and John Wagner (the “Selling Shareholders”).
The Placing has been arranged by N+1 Singer.
Completion
of the Placing is conditional upon the passing of the certain
resolutions (the “Resolutions”) at a general meeting of the Company to
be held at 11.00 a.m. on 30 November 2015 at the offices of N+1 Singer,
One Bartholomew Lane, London EC2N 2AX (the “General Meeting”) in order
to grant the Company the requisite authority to allot the new Ordinary
Shares on a non-pre-emptive basis to implement the Placing.
The
issue of the new Ordinary Shares is also conditional upon admission
becoming effective by no later than 8.00 a.m. on 2 December 2015
(“Admission”) or such other date (being not later than 8.00 a.m. on 31
December 2015) as N+1 Singer and the Company may agree and the placing
agreement entered into between the Company, N+1 Singer and the Selling
Shareholders becoming unconditional in all relevant respects and not
having been terminated in accordance with its terms prior to Admission.
Since
its admission to AIM, ATTRAQT has aimed to reinvest its limited cash
resources in organic growth by developing performance improvements and
new features, signing some important new clients across regions. ATTRAQT
has also focused on significant platform performance improvements and
new features, such as its new Hypercaching technology and completing the
migration of the entire platform to a managed cloud infrastructure.
In its latest set of financial results, in respect of the six month period to 30 June 2015, the Company reported strong financial and operational progress on its stated objectives, having continued to gain traction with leading retailers in the UK and North America, a region which has been of particular focus for the Company in terms of development and expansion.
The Directors believe that, in order to deliver on the exciting potential of its target markets, significant investment would be required to develop the Company’s sales teams in the UK and in North America, with additional investment required to expand the required production capacity to support its potential growth prospects. Although such an investment will represent a major expansion of the Company’s sales force; the Board consider this necessary in order to properly capitalise on the opportunities presented to the Group and accelerate growth.
Trading update
In
its interim results to 30 June 2015, released in September 2015, the
Company reported that it had signed seven new clients in the period
under review, including All Beauty, Bonmarché, Brown Thomas, Joules and
StylistPick.com. Post-period-end, the Group has signed a further eleven
new clients, including Bfashion and the US luggage maker TUMI, with an
annualised value of £242,000. The production team have delivered sixteen
new sites so far in H2 2015, with an annualised value of £376,000.The
Company reported an improvement in financial performance with a reduced
EBITDA loss of £0.18 million for H1 2015, compared to an EBITDA loss of
£0.31 million in H1 2014. The Company is pleased to report that in H2
2015 it reached monthly breakeven at an EBITDA level.
Use of proceeds
The
Directors intend that the net proceeds of the Placing receivable by the
Company (being approximately £2.97 million net of the expenses of the
Placing payable by the Company) will be used to expand the UK and US
sales force, increase investment in marketing and PR and expand
production capacity. The balance of the net proceeds will be used to
increase investment in working capital and capital expenditure.
Board Appointment
Conditional
upon approval of the Resolutions at the General Meeting, and with
immediate effect following conclusion of the General Meeting, Nick
Habgood will join the Board of the Company as non-executive director.
Mr
Habgood is one of the founders and a Managing Partner of Azini Capital
Partners LLP, a UK-based private equity firm that specialises in
acquiring shareholdings in private and small-cap public technology
companies from historical investors and shareholders through secondary
transactions. Prior to this Mr Habgood was the Investment Director at
LMS Capital, the investment arm of London Merchant Securities plc..
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