Mindflair shares dropped significantly after raising £490k through a discounted share issue.
- The newly raised capital aimed to reduce existing debt from £1.2m to £800k.
- New shares were issued at 0.6p each, a 12% discount on the previous closing price.
- The company’s stock value has fallen over 50% since its peak in July.
- Mindflair invests in eight companies through its SVV2 fund, backed by the British Business Bank.
Shares in the AI investment company, Mindflair, experienced a marked decrease on Tuesday, falling by as much as 10% in early trading. This decline coincided with the company’s announcement of raising £490,000 by issuing shares at a discounted rate. The decision to issue new shares at a price of 0.6p each, which represents a 12% discount compared to the previous day’s closing price, was made to address existing financial obligations.
Mindflair aimed to use the capital raised to partially pay off £1.2 million in loans, reducing the outstanding debt to approximately £800,000. The strategic financial move reflects the company’s effort to manage its liabilities whilst simultaneously maintaining operational stability in a volatile market. The decision indicates an attempt to balance immediate financial pressures with long-term growth ambitions.
Since July, Mindflair’s share value has more than halved, reflecting a challenging period for the company amidst fluctuating investor confidence. Nicholas Lee, Director of Mindflair, commented on the situation, stating: “We believe that the placing and [debt] re-profile is a good solution for all parties and provides the company with additional flexibility, notwithstanding the proximity of potential realisations from our portfolio.”
Mindflair is renowned for its focus on European enterprise AI software firms, currently engaging with eight different companies through its second fund, Sure Valley Ventures 2 (SVV2). This fund spans several sectors, including education, e-commerce, transport, and robotics, and is supported by the British Business Bank. The firm has also partnered with Imperial College London to facilitate the commercialisation of AI research and NVIDIA to offer a masterclass aimed at researchers and venture capitalists.
Overall, the strategic financial manoeuvre by Mindflair aims to stabilise its financial standing amidst ongoing market challenges.
