Nektan completes sale of US operation Respin
Nektan said it had completed the sale of a majority stake in its US business to Alternative Investment Partners for £0.3m, a lower sum than originally planned.
The deal involved the sale of 57.5% of US subsidiary Respin. It also involved the provision of $0.8m in working capital to Respin, versus the previously announced consideration of £2.0m cash and £0.3m in working capital.
‘The adjustment in purchase price and capital contribution is due to the original proposed purchaser not being able to complete the transaction in the required time period and the new purchaser renegotiating the terms,’ Nektan said.
As a result of the sale, other inter-conditional transactions including a £2.2m share issue at 15p had been reconfirmed and were expected to complete no later than 30 April.
‘Following completion of the inter-conditional transactions, the company confirms that it has sufficient working capital for its present operational requirements,’ Nektan said. However, the company said it remained in discussions with HMRC in relation to an amount owing of around £3.6m, which if not successful, could give rise to a further funding requirement. ‘We are very excited about this new partnership with AIP who specialise in investing in fast growing technology businesses,’ chief executive Lucy Buckley said. ‘The majority sale of our US subsidiary allows Nektan to retain a material stake in the emerging US market without funding it on an ongoing basis.’ ‘Removal of the cash burn of the US business will allow Nektan to focus on the profitability of its core European business and continue to grow the company globally.’