Nanosynth Group plc (LON:NNN), the AIM quoted company specialising in the synthesis and application of nanoparticles to create new and improve existing products, has announced a strategic update further to its notification of 1 June 2022.
The business is now ten months into its turnaround strategy following the appointment of Mark Duffin as CEO in September 2021, and whilst the Company understands and appreciates shareholders’ frustration at the speed of progress and irregular newsflow, the Group would like to emphasise that good momentum is being gained and updates are being provided to shareholders when appropriate to do so and in accordance with the Company’s regulatory obligations.
The Company’s new management team members are all highly successful in their respective fields of expertise and are working well together. They are both committed and motivated to realise the significant potential value inherent in the Company’s technological development programme and, if successful, the Board remains confident that this will create substantial shareholder value in the near term. The Company is continuing to strengthen its team and expertise as demonstrated by the recent appointments of Peter Gray and Andrew Stedman to the board.
As announced on 1 June 2022, due to a shift in the market with regard to mask mandates, a decision was taken not to remain in face mask production and supply. However, the partnership established with Volz Holdings v.o.s (“Volz”) remains of great value to the Company and its plan is to take the technology developed with Volz and use it to spray directly onto the media for masks and many other products within the HVAC market and beyond.
Whilst the partnership with Volz is still in its early stages, trials have been run to help both companies develop a standard retro fit to media production lines for future clients so that installation and execution become streamlined. The Company has successfully proven the technology and has had exciting results on the media tested at Volz to date. A fifth trial production run is due to take place in the coming weeks and the Board is now confident to apply for REACH UK registration (UK Registration, Evaluation, Authorisation and restriction of Chemicals) with the HSE which will allow the Company to produce up to 60 tonnes of copper (ii) oxide nano material per year. The Company has already been granted the ability to produce more copper (ii) oxide nano material than is forecast to be required for the targeted HVAC market under a PPORD licence (Production and Process Orientated Research and Development) and the final environmental fate report will be created after the forthcoming trial which will allow the REACH UK registration to be progressed. This will then open the market for the Company, allowing Volz to apply the technology to all of its products which is expected to lead to wider industry adoption of the technology. Expressions of interest are already coming from the market and an exciting pipeline is being established.
Also announced on 1 June 2022 was the Company’s R&D roadmap across seven verticals. Each of the projects in the map are based on a fully considered business case, market analysis and detailed work schedules. The Company has grouped the required patents into 11 distinct categories and is currently in the process of applying for them.
As the initial phases of the works schedule are completed, the Company will seek to enter into long term commercial agreements with appropriate partners. Discussions are at various stages of progress with credible market counterparties and the Directors expect that commercial partnerships, once agreed, will commence with an R&D partnership, paid for by the partner, to deliver the project and then move to an exclusive commercial agreement based on minimum volume requirements. Although the Directors are confident that these discussions will lead to binding agreements, there can be no certainty in this regard and further updates will be announced once agreements are finalised.
During the turnaround of the business a key focus has been to move P2F from an R&D business established with a university to a commercial standalone company. The Company has taken the patent for a one disk nano producing reactor to a 4-disk reactor that produces the same quality and consistency. The Company is now in the process of building two full scale production reactors containing 20 disks. This will provide the potential to be the largest nano producer in the marketplace. GB Nano Ltd has been established as a wholly owned subsidiary of the Group and will act as the vehicle to sell nano ingredients directly to customers. This is being set up as an e-commerce business and will initially launch with 40 plus products. The site is currently being developed and the ingredients produced for future launch.
M&A remains a longer-term strategy for the Company but the current market climate does not support the Company’s aspirations. Rather than lose time, the board has worked at some length to identify suitable targets and is looking to establish joint ventures with a right to buy when the market permits.
Mark Duffin, Chief Executive of nanosynth, commented: “Rapid progress is being made and we look forward to updating shareholders as our various initiatives build traction. The team has gone above and beyond for the business and the current progress is testament to the strategy and their commitment. I sincerely thank them for their continued support and effort and would like to also thank our shareholders for their patience and support as we transform the business. We look forward to providing further updates as we progress our strategy.”