IQE plc: Closing of CLN Financing

IQE PLC

14 March 2025

 

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD BREACH ANY APPLICABLE LAW OR REGULATION

Cardiff, UK
14 March 2025

IQE plc

Closing of Convertible Loan Note Financing

Director / PDMR Shareholding Notification

IQE plc ("IQE" or "the Company"), a leading supplier of compound semiconductor wafer products and advanced material solutions to the global semiconductor industry, is pleased to announce the closing of its convertible loan note fundraising and that IQE has raised aggregate subscription proceeds of £18 million (the "Fundraising").

Closing of the Fundraising follows the Company's announcement on 12 February 2025 that it had entered into subscription agreements with a consortium of existing shareholders, and certain senior executives and Directors, led by IQE's largest shareholder Lombard Odier, and shareholder approval for the necessary resolutions to implement the Fundraising at the general meeting of the Company held on 10 March 2025.

No offer or invitation is being made to shareholders more generally to purchase, acquire or subscribe for any of the loan notes being issued as part of the Fundraising. No application will be made for the admission of such loan notes to trading on AIM or any recognised securities exchange.

Additional details on the terms of the Fundraising can be found in the Company's news release on 12 February 2025 and in the circular sent to the Company's shareholders and published on 14 February 2025.

The Fundraising is secured against the Company's assets in the UK and subordinated to the Company's existing financing facility with HSBC UK Bank PLC ("HSBC") which has been amended and restated simultaneously with the closing of the Fundraising.

PDMR dealing

Mark Cubitt and Bami Bastani are Directors and PDMRs of the Company and have participated in the Fundraising in the following amounts.

	Principal amount of loan notes subscribed for	Subscription price paid	Current shareholding (and % of existing issued share capital)	Maximum number of conversion shares
Mark Cubitt (Executive Chair)	£235,294	£200,000	0	1,568,627
Bami Bastani (Non-executive Director)	£94,118	£80,000	171,000 (0.02%)	627,451

The FCA notification made in accordance with the requirements of UK MAR is set out at the end of this announcement.

Strategic Review

As previously announced, the Group is currently conducting a comprehensive Strategic Review of its asset base to ensure a strong capital position to further invest in core operations. The Board has retained Lazard to advise on the Strategic Review, which will be overseen by IQE's Board of Directors, with input from key stakeholders.

As part of the Strategic Review, IQE has broadened its options in relation to the proposed IPO of IQE Taiwan to include the possibility of a full sale of IQE Taiwan. The Board believes there is a significant market opportunity in IQE's core operations and remains focused on reducing its cost structure for profitable growth, servicing its customers and maximising value for shareholders. IQE will provide a further update when appropriate. At this stage, there can be no certainty as to the outcome of the Review.

Mark Cubitt, Executive Chair of IQE, commented:

"We are pleased to have closed our convertible loan note fundraising, which will significantly strengthen our near-term financial position. This reflects the support we have from our shareholders, who recognise the significant market opportunity for IQE and its long-term strategy. Our Strategic Review will enable IQE to unlock the significant unrealised value within the business and ensure it is able to invest in its growth strategy."

Contacts:

IQE plc

[phone]

Mark Cubitt

Jutta Meier

Amy Barlow

Lazard (Financial Adviser)

[phone]

Cyrus Kapadia

Keiran Wilson

Alexander Fiallos

Peel Hunt (Nomad and Joint Broker)

[phone]

Ben Cryer

Kate Bannatyne

Adam Telling

Deutsche Numis (Joint Broker)

[phone]

Simon Willis

Hugo Rubinstein

Iqra Amin

Headland Consultancy (Financial PR)
+ 44 (0) 20 38054822

Andy Rivett-Carnac: [phone]

Chloe Francklin: [phone]

ABOUT IQE

http://iqep.com

IQE is the leading global supplier of advanced compound semiconductor wafers and materials solutions that enable a diverse range of applications across:

·    Smart Connected Devices

·    Communications Infrastructure

·    Automotive and Industrial

·    Aerospace and Security

As a scaled global epitaxy wafer manufacturer, IQE is uniquely positioned in this market which has high barriers to entry. IQE supplies the global market and is enabling customers to innovate at chip and OEM level. By leveraging the Group's intellectual property portfolio including know-how and patents, it produces epitaxy wafers of superior quality, yield and unit economics.

IQE is headquartered in Cardiff UK, with employees across manufacturing locations in the UK, US and Taiwan, and is listed on the AIM Stock Exchange in London.

1.	Details of the Person discharging managerial responsibilities ("PDMR") / person closely associated with them ("PCA")
a)	Name	Mark Cubitt
2.	Reason for the notification
a)	Position / status	Executive Chair
b)	Initial notification / amendment	Initial notification
3.	Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a)	Name	IQE plc
b)	Legal Entity Identifier	213800Y33WHD3ESJJP16
4.	Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a)	Description of the financial instrument	Subscription for convertible loan notes convertible into ordinary shares of 1 pence each in the Company at a price of 15 pence per share. The underlying ordinary shares have an ISIN of GB0009619924
b)	Nature of the transaction	Participation in subscription for convertible loan notes
c)	Price(s) and volume(s)	Price: Conversion price of 15 pence per ordinary share Volume: (principal value of convertible loan notes subscribed for): £235,294
d)	Aggregated information ·       Aggregated volume ·       Aggregated price	N/A
e)	Date of the transaction(s)	13 March 2025
f)	Place of the transaction	Off-market

1.	Details of the Person discharging managerial responsibilities ("PDMR") / person closely associated with them ("PCA")
a)	Name	Bami Bastani
2.	Reason for the notification
a)	Position / status	Non-executive Director
b)	Initial notification / amendment	Initial notification
3.	Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a)	Name	IQE plc
b)	Legal Entity Identifier	213800Y33WHD3ESJJP16
4.	Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a)	Description of the financial instrument	Subscription for convertible loan notes convertible into ordinary shares of 1 pence each in the Company at a price of 15 pence per share. The underlying ordinary shares have an ISIN of GB0009619924
b)	Nature of the transaction	Participation in subscription for convertible loan notes
c)	Price(s) and volume(s)	Price: Conversion price of 15 pence per ordinary share Volume: (principal value of convertible loan notes subscribed for): £94,117.65
d)	Aggregated information ·       Aggregated volume ·       Aggregated price	N/A
e)	Date of the transaction(s)	13 March 2025
f)	Place of the transaction	Off-market

IMPORTANT NOTICES

Lazard & Co., Limited ("Lazard"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively as financial adviser to IQE and no one else in connection with the Strategic Review and will not be responsible to anyone other than IQE for providing the protections afforded to clients of Lazard & Co., Limited nor for providing advice in relation to the Strategic Review or any other matters referred to in this announcement. Neither Lazard & Co., Limited nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Lazard & Co., Limited in connection with this announcement, any statement contained herein or otherwise.

Peel Hunt LLP ("Peel Hunt"), which is authorised and regulated in the United Kingdom by the FCA and is a member of the London Stock Exchange, is acting for the Company in connection with the Proposed Transaction and will not be acting for any other person (including a recipient of this document) or otherwise be responsible to any person for providing the protections afforded to clients of Peel Hunt or for advising any other person in respect of the Proposed Transaction or any transaction, matter or arrangement referred to in this document. Peel Hunt's responsibilities as the Company's nominated adviser and broker under the AIM Rules for Nominated Advisers are owed solely to the London Stock Exchange and are not owed to the Company or to any Director or to any other person in respect of the Proposed Transaction.

Numis Securities Limited (trading as "Deutsche Numis") ("Deutsche Numis"), which is authorised and regulated in the United Kingdom by the FCA, is acting as Joint Broker to the Company and will not be acting for any other person or otherwise be responsible to any person for providing the protections afforded to clients of Deutsche Numis or for advising any other person in respect of the Proposed Transaction or any transaction, matter or arrangement referred to herein. Neither Deutsche Numis nor any of its affiliates (nor any of their respective directors, officers, employees or agents), owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Deutsche Numis in connection with the Proposed Transaction or any statement contained herein or otherwise. No representation or warranty, express or implied, is made by Deutsche Numis as to the contents of this Announcement.

DISCLAIMER

Neither the information nor any opinion contained in this announcement constitutes an inducement or offer to purchase or sell or a solicitation of an offer to purchase or sell any securities or other investments in IQE or any other company by IQE or any of its affiliates in any jurisdiction. This announcement does not consider the investment objective, financial situation, suitability or the particular need or circumstances of any specific individual who may access or review this announcement and may not be taken as advice on the merits of any investment decision. This announcement is not intended to provide the sole basis for evaluation of, and does not purport to contain all information that may be required with respect to, any potential investment in IQE. Any person who is in any doubt about the matters to which this announcement relates should consult an authorised financial adviser or other person authorised under the UK Financial Services and Markets Act 2000.

DISTRIBUTION

Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws of that jurisdiction. The distribution of this announcement in certain countries may be restricted by law and persons who access it are required to inform themselves and to comply with any such restrictions. IQE disclaims all responsibility where persons access this announcement in breach of any law or regulation in the country of which that person is a citizen or in which that person is residing or is domiciled.

 

END