NetScientific Plc Announce an Initial £1m Investment in Martlet Capital Limited
16th September 2021
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.