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(Sharecast News) - Shares in bioplastics and radio frequency technology business Biome Technologies tanked early on Friday after the group launched a heavily discounted equity round in an effort to fight off liquidation.
Biome intends to raise up 950,000 through the issuance of 19.0m shares at 5.0p a piece, a 76.7% discount to its mid-market closing price on Thursday, and also launched an 80,000 retail offer to existing shareholders.
The AIM-listed group cautioned that it would only have sufficient cash to fund its activities "through to the middle of September 2024" if shareholders refused to push through the funding rounds, stating that there were "currently no alternate sources of funding available" in the necessary time scale.
Biome stated the fundraising efforts would substantially lower its debt position and if not approved, would have to "place the company into a members' voluntary liquidation" to enable payment of all creditors in full.
In terms of recent trading, Biome added that revenues had fallen from 3.6m to 2.3m in H1, principally due to continued production and regulatory difficulties at two of its bioplastics unit's end-customers and H2 phasing of revenue from four significant RF division projects.
As of 1000 BST, Biome shares had sunk 53.02% to 10.10p.
Reporting by Iain Gilbert at Sharecast.com
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