Investment in Martlet Capital Limited

RNS Number : 9234L

NetScientific PLC

16 September 2021

 

NetScientific plc

("NetScientific", the "Group" or the "Company")

I nvestment in Martlet Capital Limited 

London, UK - 16 September 2021 - NetScientific plc (AIM: NSCI), an active holding company in life sciences and sustainability technology investment, is pleased to announce an initial £1m investment in Martlet Capital Limited ("Martlet Capital"), which intends to acquire a portfolio of minority interests in the Cambridge high-tech cluster.

NetScientific's fully-owned subsidiary EMV Capital Limited ("EMV Capital") has co-led a first close of a £12.0m investment into Martlet Capital, which has yet to start trading, alongside leading private office Saranac Partners. The investment is expected to enable Martlet Capital to complete the acquisition of a portfolio of over 50 minority investments of Marshall of Cambridge Limited, the "Martlet Capital" trading name and the team managing the investments. The investments include companies in life science, healthcare, cleantech, sustainability, industrials and semi-conductors (the "portfolio companies"), many with co-investments by some of the leading Cambridge and UK investment groups.

Martlet Capital is targeting an eventual total raise of approximately £22m over the next 6 months, which would enable significant further investment into selected portfolio companies and new investment opportunities. Martlet Capital aims to become the leading investment house for early-stage Cambridge technology cluster companies.

NetScientific's initial investment in Martlet has resulted in an initial equity interest of 6.8%.Through its "capital light" approach, EMV Capital intends to introduce syndicated investment into Martlet from its investor network, so reducing its initial investment from £1.0m to £0.25m. Following completion of the targeted £22m raise and the syndication of NetScientific's initial investment, it is expected that the Group's direct investment in Martlet will fall to circa 1%, but it will retain a significant interest through its "capital under advisory".

As a result of its investment in Martlet, the Group, together with Saranac Partners and Martlet, intends to establish shortly a follow-on funding vehicle Cambridge Marquity Investments Limited ("Marquity"), which is expected to be 40% owned by the Group in return for a £100,000 investment. The Group expects to make future judicious investments through Marquity, targeting the more advanced portfolio companies, which show the requisite strong performance to add shareholder value and realise returns. Finally, the Group intends to provide a line of credit of up to £1m to Marquity, enabling it to operate quickly and decisively, and capitalise on emerging opportunities from Martlet Capital.

NetScientific CEO, Dr. Ilian Iliev, will join the Board of Martlet and intends to join the Board of Marquity as a Non-Executive Director.

Ilian Iliev noted: "This investment marks another step in NetScientific's expansion strategy, and demonstrates the potential of NetScientific's investment approach to generate continued growth in value. We now have proprietary access to top-quality deal flow from one of the world's leading technology clusters in Cambridge, with a strong scale-up investment partner. The detailed work, analysis, due diligence and investment planning performed by our team, as well as the experience of the Martlet team and our co-investment partners provides us with confidence that we will see significant growth in the value of the underlying assets.

"In line with our business plans, this investment will facilitate additional transactional fees and revenues to the group, add to the direct investment value, deploy the capital-light investment model, add to our Capital Under Advisory, and open up new opportunities."

John Clarkson, Chairman of NetScientific commented: "This is an exciting transaction for NetScientific with the limited financial investment in Martlet allowing us to take a 40% interest in the follow-on investment vehicle Marquity. This puts us in a prime position to select the most promising deals from the high quality, targeted portfolio which can deliver significant growth opportunities. It gives us access to the growth stories of successful technology companies emerging from the world class Cambridge ecosystem.

"The NetScientific Board expects to see a number of compelling opportunities arise from this arrangement and welcomes the relationships it brings to the group.

"NetScientific has established a clear strategy for the continued growth and success of the company, through a well-balanced portfolio, proactive management and structured investment programme. This judicious investment reflects the planned, focused next step, with further substantial prospects from follow-on opportunities, to add shareholder value and realise returns."

Further announcements will be made when appropriate.   The related EMV Capital press release can be seen at https://emvcapital.com/news/  

This announcement includes inside information as defined in Article 7 of the UK version of Market Abuse Regulation No. 596/2014 as it forms part of UK law as retained EU law as defined in, and by virtue of, the European Union (Withdrawal) Act 2018, as amended, and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations. 

For more information, please contact:

NetScientific	Via Walbrook PR
Ilian Iliev, CEO
WH Ireland (NOMAD, Financial Adviser and Broker)
Chris Fielding / Darshan Patel	[phone]
Walbrook PR
Nick Rome/ Paul McManus/ Nicholas Johnson	07748 325 236, 07980 541 893 or 07884 664 686

About NetScientific

NetScientific plc (AIM: NSCI) is an active holding company, that invests in, develops, commercialises and realises shareholder value in life sciences/healthcare, sustainability and technology companies, which offer significant growth potential predominately in the UK and USA, as well as globally. 

With the acquisition of EMV Capital in August 2020, the Group doubled its portfolio from 8 to 17 companies, either through direct subsidiary, balance sheet investment or capital under advisory, varying from start-up private companies to publicly listed equities. 

NetScientific delivers shareholder returns through a proactive and hands-on management approach to their portfolio companies; identifying, investing in, and helping to build game-changing companies. The Group targets value inflection points and the release of value through partial or full exits from trade sales, public listings, or equity sales. The Company has a strong transatlantic and growing international presence, providing attractive expansion prospects. 

NSCI can deploy a capital-light investment structure; utilising the power of the PLC Brand, and the NetScientific balance sheet to anchor future investments and achieve a multiplier effect by attracting 3rd party investment for the portfolio companies. 

NetScientific is headquartered in London, United Kingdom, and was admitted to trading on AIM, a market operated by the London Stock Exchange, in 2013 (website:  https://netscientific.net/ ).

About EMV Capital

https://emvcapital.com/    

EMV Capital Ltd (EMVC), a fully-owned subsidiary of AIM-listed NetScientific PLC, is a London-based award-winning investor focused on B2B companies in the healthcare, sustainability and industrials sectors with investments in the UK, US and Israel. EMVC's model is to develop a customized investment strategy for each company, combining its network of investors from Family Offices, Wealth Managers, Institutional VC investors and Corporate VC funds. EMVC recognizes the benefits of corporate engagement for early-stage technology companies, with EMVC's team having led and structured investments alongside some of the world's leading corporations. EMV Capital has a growing EIS investment practice, and is an exclusive advisor to the EMVC Evergreen EIS Fund.

EMV Capital Limited is an appointed representative of Sapphire Capital Limited, which is authorised and regulated by the Financial Conduct Authority.

About Martlet Capital

www.martletcap.com

Martlet Capital, the investment arm of Marshall of Cambridge Limited, is an early-stage investor based in Cambridge, which has invested in more than 60 start-ups with high growth potential, since its launch in 2011. Martlet Capital provides patient capital for IP rich, early-stage B2B start-ups, with a primary focus on deep technology and life science companies based in Cambridge. The team is comprised of experienced investors and entrepreneurs. In addition to capital, the team offers value beyond capital through support, experience and a network of contacts. Over the last decade they have achieved several exits from their portfolio, helping companies scale from first-round through to exit from trade sales to global technology companies and IPO's.

About Saranac Partners

www.saranacpartners.com

Saranac Partners is a Private Office based in London. It works with families, business owners and private investors across Europe, the Middle East and Asia to deploy and access capital.

Saranac Partners offers a range of services across Strategy, Investments, Financing and Corporate Advisory. It oversees allocation and deployment of capital across private and public markets and manages, advises and oversees client portfolios.  It provides access to diverse sources of capital and works with business owners and management teams to provide insight and support for corporate interests. The firm is owned by long-term strategic investors and staff. Saranac Partners Limited is authorised and regulated by the Financial Conduct Authority.

 

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