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RNS Number : 0037Y
RiverFort Global Opportunities PLC
10 May 2021
10 May 2021
THIS ANNOUNCEMENT, INCLUDING THE INFORMATION CONTAINED IN IT, IS
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CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMATION,
OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE
OR DISPOSE OF ANY SECURITIES IN RIVERFORT GLOBAL OPPORTUNITIES PLC
OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT
NOR THE FACT OF ITS DISTRIBUTION SHALL FORM THE BASIS OF, OR BE
RELIED ON IN CONNECTION WITH, ANY INVESTMENT DECISION IN RESPECT OF
RIVERFORT GLOBAL OPPORTUNITIES PLC.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF REGULATION 2014/596/EU (WHICH FORMS PART OF
DOMESTIC UK LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT
2018 (THE "EUWA")) ("UK MAR"). UPON THE PUBLICATION OF THIS
ANNOUNCEMENT, THIS INSIDE INFORMATION (AS DEFINED IN UK MAR) IS NOW
CONSIDERED TO BE IN THE PUBLIC DOMAIN.
PLEASE SEE THE IMPORTANT NOTICE WITHIN THIS ANNOUNCEMENT.
10 May 2021
RiverFort Global Opportunities plc
("RGO" or the "Company")
Investment in Smarttech247 and placing
Total voting rights
Highlights
-- EUR1.4 million investment in Smarttech247, a leading global
artificial intelligence cyber security business with a focus on
threat detection, investigation and response, with over 50
customers, including the Institute of Cancer Research UK and Aryzta
Global
-- Placing to raise GBP1.64 million from existing shareholders
and new investors at a price of 1.7 pence per share
-- Smarttech247 is an established profitable business with
significant growth potential and an intention to seek a stock
market listing in the short term
-- Automated, AI cloud based cyber security is a fast growing
sector as threats to businesses continue to intensify
-- Cyber security is a global market sector growing rapidly and
is currently worth in excess of US$150 billion
Philip Haydn-Slater, Non-executive Chairman of RGO, said:
"This is a compelling investment opportunity for RGO as it
provides an opportunity to invest in a very attractive and high
growth technology sector through an established company with a
proven track record. At the same time, it is very complementary to
and is balanced with our existing investment portfolio,
particularly as we grow our investment portfolio in the technology
sector. We are also delighted to welcome Chris Akers as a new
significant shareholder and are hugely encouraged by the support
from our existing institutional shareholders who have participated
in the placing."
Introduction
RiverFort Global Opportunities plc is pleased to announce that
it has agreed to invest EUR1.4 million in Smarttech247
(incorporated in the Republic of Ireland as Zefone Limited) a
global artificial intelligence ("AI") based cyber security cloud
business that protects enterprises as they migrate to cloud-based
IT operations (the "Investment"). Smarttech247 is a growing
business, with financial results for the current financial year
expected by Smarttech247 management to be significantly ahead of
2020. Smarttech247 has over 100 technology partners (including
Tanium and Crowdstrike) and 50 clients based in Europe and the USA.
It is intended that the funding shall accelerate Smarttech247's
extension and roll-out of its AI-based cyber security product
portfolio.
The Investment will be via a convertible loan note and will form
part of an overall fundraising by Smarttech247 of EUR2.5 million.
The convertible loan note carries a coupon of 5% and is expected to
convert on a sale or listing of the company.
At the same time, the Company has placed 96,470,587 new ordinary
shares (the "Placing Shares") to raise gross proceeds of GBP1.64
million in cash at a price of 1.7 pence per new ordinary share (the
"Placing Price"), representing a 12.8% discount to the closing
mid-market price on 7 May 2021 (the "Placing"). The purpose of the
Placing is to provide funding both for the Investment and for other
investment opportunities. The principal investors in the placing
include the Company's major existing institutional shareholders and
new investors which include Mr Chris Akers. The Placing is being
undertaken within the Company's existing authorities to allot
shares and is conditional on admission to trading on AIM.
Placees will also conditionally receive one warrant for each
ordinary share subscribed for, exercisable at 3.4 pence for a
period of two years from their date of issue (the "Warrants") and
expiring on the two-year anniversary of the date of issue . The
issue of the Warrants will be conditional on shareholder
authorities to be sought at the next Annual General Meeting.
Application will be made to the London Stock Exchange for the
Placing Shares, which will rank pari passu with the Company's
existing ordinary shares, to be admitted to trading on AIM
("Admission"). Admission is expected to take place on or around 10
June 2021. Peterhouse Capital acted as broker to the Placing.
Information on Smarttech 247
Smarttech247 is an established company in cyber security
management with a successful track record of revenue growth and
profitability and is positioned at the intersection of three major
cyber security growth markets:
-- Security threat incidents
-- Growth of cloud adoption amongst both large and small-medium enterprises
-- Proliferation of cyber-security data generation that needs to be integrated
Smarttech247 is able to provide 24/7 threat detection,
investigation and response. The company has over 80 employees, 50
customers, 100 technology partners and multiple security operation
centres across Europe.
For the period ended 31 July 2020, the company reported audited
profits before taxation of EUR829,000 on revenue of EUR4.8 million.
Smarttech247 has contracts with enterprises that include the
Institute of Cancer Research UK, Aryzta Global and the Royal
College of Surgeons Ireland. Smarttech247 expects to use the
proceeds from its fundraise principally to invest in building its
marketing presence and for recruitment in order to expand and
roll-out its AI-based cyber security product portfolio. More
information on Smarttech247 can be found on its website at
www.smarttec247.com.
Smarttech247 has indicated its intention to seek a stock market
listing in the short term and the Board therefore believes that an
investment in Smarttech247 at this juncture, given the progress
that it has made to date, represents a good opportunity for RGO and
its shareholders.
Information on the cyber security industry
There is currently a high level of cyber security threat
incidents which is creating a need for new and better security
products and services. Furthermore, cloud migration means that
companies need to redesign their existing systems which is
generating new cyber security requirements.
Cyber security applications are also being re-engineered to
include cyber security reporting which is increasing the generation
of cyber security data. A shortage of qualified specialist skills
and associated cost is leading companies to adopt external
automated cyber-security platforms. These trends are creating
increasing demand for AI based cloud cyber-security platforms which
can be provided by Smarttech247. Fortune Business Insights
currently value the cybersecurity market at US$153 billion, which
is growing at 12% pa and therefore projected to be worth US$366
billion by 2028.
Background to the Placing
The Company has been generating attractive returns through
investing generally by way of structured products which have the
benefit of delivering cash returns whilst providing downside
protection. At the same time, the Board is seeing an increasing
number of pre-IPO investment opportunities where there is potential
to achieve gains between the pre-IPO stage and a listing or exit.
The Company has already deployed capital in this way as
demonstrated by its recent investment in Pluto Digital Assets plc
("Pluto"), a company that is not only in an exciting sector but is
seeking a stock market listing in the short term. Furthermore, at
this stage of a company's development, valuations can be
attractive, notwithstanding the proximity of an investee company to
an exit or listing.
The Investment is also consistent with the Company's wish to
increase its exposure to the technology sector - RGO already has a
substantial shareholding in Pires Investments plc, the investment
company listed on AIM, focused on investing in next generation
technology, which has increased in value significantly both since
RGO first made its investment and during 2021, and its more recent
investment in Pluto.
The Board is therefore keen to be able to have additional funds
to deploy in these opportunities as well as to continue to invest
by way of structured products.
Total voting rights
In conformity with DTR 5.6.1, the Company notifies that at
Admission, the number of ordinary shares in issue will be
775,404,187. There are no ordinary shares held in treasury and each
ordinary share entitles the holder to a single vote at general
meetings of the Company. This figure may then be used by
shareholders as the denominator for the calculations by which they
will determine if they are required to notify their interest in RGO
under the FCA's Disclosure and Transparency Rules .
For more information please contact:
RiverFort Global Opportunities
plc +44 20 3368 8978
Philip Haydn-Slater,
Non-executive Chairman
-----------------
Nicholas Lee, Investment
Director
-----------------
Nominated Adviser +44 20 7628 3396
-----------------
Beaumont Cornish
-----------------
Roland Cornish/Felicity
Geidt
-----------------
Joint Broker and broker
to the Placing +44 20 7562 3351
-----------------
Peterhouse Capital Limited
-----------------
Lucy Williams
-----------------
Joint Broker +44 20 7186 9950
-----------------
Shard Capital Partners
LLP
-----------------
Damon Heath/ Erik Woolgar
-----------------
Market soundings (as defined in UK MAR) were taken in respect of
the Placing with the result that certain persons became aware of
inside information (as defined in UK MAR), as permitted by UK MAR.
This inside information is set out in this Announcement. Therefore,
those persons that received inside information in a market sounding
are no longer in possession of such inside information relating to
the Company and its securities.
Persons who have chosen to participate in the Placing, by making
an oral or written offer to acquire Placing Shares, will be deemed
to have read and understood this Announcement in its entirety and
to be making such offer on the terms and subject to the conditions
herein.
For the purposes of UK MAR, the person responsible for arranging
for the release of this Announcement on behalf of RiverFort Global
Opportunities plc is Nicholas Lee, Investment Director.
IMPORTANT INFORMATION
This Announcement does not constitute, or form part of, any
offer or invitation to sell or issue, or any solicitation of any
offer to purchase or subscribe for any securities in the United
States, Canada, Australia, Japan or the Republic of South Africa or
in any other jurisdiction in which such offer or solicitation is
unlawful, prior to registration, exemption from registration or
qualification under the securities laws of any jurisdiction. The
distribution of this Announcement and other information in
connection with the placing and admission in certain jurisdictions
may be restricted by law and persons into whose possession this
Announcement, any document or other information referred to herein
comes should inform themselves about and observe any such
restriction. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such
jurisdiction. Neither this Announcement nor any part of it nor the
fact of its distribution shall form the basis of or be relied on in
connection with or act as an inducement to enter into any contract
or commitment whatsoever.
Peterhouse Capital, which is authorised and regulated in the
United Kingdom by the Financial Conduct Authority, is acting
exclusively for the Company as Broker in connection with the
placing and admission, and will not be responsible to any other
person for providing the protections afforded to customers of
Peterhouse Capital or advising any other person in connection with
the placing and admission. Apart from the responsibilities and
liabilities, if any, which may be imposed on Peterhouse Capital by
the Financial Services and Markets Act 2000, as amended or the
regulatory regime established under it, Peterhouse Capital does not
accept any responsibility whatsoever for the contents of this
Announcement, and no representation or warranty, express or
implied, is made by Peterhouse Capital with respect to the accuracy
or completeness of this Announcement or any part of it and no
responsibility or liability whatsoever is accepted by Peterhouse
Capital for the accuracy of any information or opinions contained
in this Announcement or for the omission of any material
information from this Announcement.
This Announcement may include statements that are, or may be
deemed to be, "forward-looking statements". These forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms "believes", "estimates", "plans",
"projects", "anticipates", "expects", "intends", "may", "will", or
"should" or, in each case, their negative or other variations or
comparable terminology. These forward-looking statements include
matters that are not historical facts. They appear in a number of
places throughout this Announcement and include statements
regarding the directors' current intentions, beliefs or
expectations concerning, among other things, the Company's results
of operations, financial condition, liquidity, prospects, growth,
strategies and the Company's markets. By their nature,
forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. Actual results and
developments could differ materially from those expressed or
implied by the forward-looking statements. Forward-looking
statements may and often do differ materially from actual results.
Any forward-looking statements in this Announcement are based on
certain factors and assumptions, including the directors' current
view with respect to future events and are subject to risks
relating to future events and other risks, uncertainties and
assumptions relating to the Company's operations, results of
operations, growth strategy and liquidity. Whilst the directors
consider these assumptions to be reasonable based upon information
currently available, they may prove to be incorrect. Save as
required by applicable law or regulation, the Company undertakes no
obligation to release publicly the results of any revisions to any
forward-looking statements in this Announcement that may occur due
to any change in the directors' expectations or to reflect events
or circumstances after the date of this Announcement.
This Announcement is directed only at: persons who are (a) in a
member state of the European Economic Area who are qualified
investors (within the meaning of the Prospectus Regulation (EU)
2017/1129) ("EU Prospectus Regulation"), (b) in the United Kingdom
qualified investors as defined in article 2(e) of the EU Prospectus
Regulation as it forms part of UK domestic law by virtue of the
EUWA, (the "UK Prospectus Regulation"), who (i) have professional
experience in matters relating to investments falling within
Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 ("Order") (investment
professionals) or (ii) who fall within Article 49(2)(a) to (d) of
the Order (high net worth companies, unincorporated associations
etc.) and (c) those persons to whom it may otherwise be lawfully
communicated.
The Placing Shares to be issued pursuant to the Placing will not
be admitted to trading on any stock exchange other than AIM.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this Announcement.
UK Product Governance Requirements
Solely for the purposes of the product governance requirements
contained within the FCA Handbook Product Intervention and Product
Governance Sourcebook (the "UK Product Governance Rules") , and
disclaiming all and any liability, whether arising in tort,
contract or otherwise, which any 'manufacturer' (for the purposes
of the UK Product Governance Rules) may otherwise have with respect
thereto, the Placing Shares have been subject to a product approval
process, which has determined that the Placing Shares are: (i)
compatible with an end target market of (a) retail clients, as
defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as
it forms part of domestic law by virtue of the EUWA , (b) investors
who meet the criteria of professional clients as defined in
Regulation (EU) No 600/2014 as it forms part of domestic law by
virtue of the EUWA and (c) eligible counterparties as defined in
the FCA Handbook Conduct of Business Sourcebook ("COBS"); and (ii)
eligible for distribution through all distribution channels as are
permitted by Directive 2014/65/EU (the "UK Target Market
Assessment"). Notwithstanding the UK Target Market Assessment,
distributors should note that: the price of the Placing Shares may
decline and investors could lose all or part of their investment;
the Placing Shares offer no guaranteed income and no capital
protection; and an investment in the Placing Shares is compatible
only with investors who do not need a guaranteed income or capital
protection, who (either alone or in conjunction with an appropriate
financial or other adviser) are capable of evaluating the merits
and risks of such an investment and who have sufficient resources
to be able to bear any losses that may result therefrom. The UK
Target Market Assessment is without prejudice to the requirements
of any contractual, legal or regulatory selling restrictions in
relation to the Placing. Furthermore, it is noted that,
notwithstanding the UK Target Market Assessment, Peterhouse Capital
will only procure investors who meet the criteria of professional
clients and eligible counterparties.
For the avoidance of doubt, the UK Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of COBS; or (b) a recommendation to any investor
or group of investors to invest in, or purchase, or take any other
action whatsoever with respect to the Placing Shares. Each
distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining
appropriate distribution channels.
EU Product Governance Requirements
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "MiFID
II Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any 'manufacturer' (for the purposes of the MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the Shares have been subject to a product approval process, which
has determined that the Placing Shares are: (i) compatible with an
end target market of retail clients and investors who meet the
criteria of professional clients and eligible counterparties, each
as defined in MiFID II; and (ii) eligible for distribution through
all distribution channels as are permitted by MiFID II (the "EU
Target Market Assessment"). Notwithstanding the EU Target Market
Assessment, distributors should note that: the price of the Shares
may decline and investors could lose all or part of their
investment; the Placing Shares offer no guaranteed income and no
capital protection; and an investment in the Shares is compatible
only with investors who do not need a guaranteed income or capital
protection, who (either alone or in conjunction with an appropriate
financial or other adviser) are capable of evaluating the merits
and risks of such an investment and who have sufficient resources
to be able to bear any losses that may result therefrom. The EU
Target Market Assessment is without prejudice to the requirements
of any contractual, legal or regulatory selling restrictions in
relation to the placing. Furthermore, it is noted that,
notwithstanding the EU Target Market Assessment, Peterhouse Capital
will only procure investors who meet the criteria of professional
clients and eligible counterparties.
For the avoidance of doubt, the EU Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase or take
any other action whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
Beaumont Cornish Limited ("Beaumont Cornish"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting as Nominated Adviser ("Nomad") to the Company in connection
with the Placing, the terms of which have been agreed solely
between the Company and its Broker, and will not be acting for any
other person or otherwise be responsible to any person for
providing the protections afforded to clients of Beaumont Cornish
or for advising any other person in respect of the matters set out
in this announcement or any transaction, matter or arrangement
referred to in this announcement. Beaumont Cornish's
responsibilities as the Company's Nomad are owed solely to London
Stock Exchange and are not owed to the Company or to any Director
or to any other person in respect of his or her decision to acquire
any shares in the Company.
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