DeepMatter falls 35% amid discounted share sale

Shares of Glasgow-based DeepMatter Group plc, the AIM-listed company focusing on digitizing chemistry, fell about 35% on Friday to about 0.40p after it announced plans for a deeply discounted sale of shares and said its revenue for 2021 will be lower than directors’ expectations.

The Glasgow company said it is “dependent on the completion of the fundraise and the receipt of the net proceeds …”

DeepMatter announced a placing and subscription to raise gross proceeds of £2.55 million, at a price of 0.1p per new ordinary share, and is also proposing to raise up to £0.25 million via an open offer which will be available to all qualifying shareholders.

“Following DeepMatter’s announcement on 17 December 2021 that it was in discussions around raising equity investment, the placing and subscription will enable the group to move forward without the need to re-evaluate its strategy and outlook,” said DeepMatter.

“The placing and subscription is being financed by a small number of new professional individual investors and existing institutional shareholders.

“In addition to the placing and subscription, the group is proposing to raise up to £0.25 million by way of an open offer which will be available to all qualifying shareholders at the record time …”

On December 17, DeepMatter said it was in advanced discussions to provide its DigitalGlassware platform and data to Standigm Inc., a workflow artificial intelligence (AI) drug discovery company based in South Korea.

But on Friday, DeepMatter said: “Further to the announcement made on the 17 December 2021, DeepMatter continues to engage with Standigm over the multi-year deal as outlined.

“However, the directors now believe that this contract will now be signed in 2022, which will result in revenue for 2021 being lower than director’s expectations.

“The group is dependent on the completion of the fundraise and the receipt of the net proceeds of the fundraise in order for it to continue to meet its forecasts and execute its strategy.

“In the event that the resolutions are not passed at the general meeting and the fundraise is not completed, the board would have to immediately re-evaluate the strategy and outlook of the group.”

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Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.