Beleaguered tech firm WANdisco has sounded the alarm on its cash levels as it seeks a speedy $30 million capital raise to avert its demise.
The Sheffield-based business said it only has enough working capital to survive till the middle of July and plans to raise fresh funds from shareholders before the end of June.
In March the company stunned investors after it said it had discovered a gaping hole in its sales and bookings figures that it warned would threaten the business as a going concern. It suspended its shares and commissioned chair Ken Lever to conduct an investigation into potential fraud.
In an update Lever said: “The business needs to be urgently properly capitalised and so today we are announcing our desire to raise $30 million towards the end of June.
“Unfortunately, much of this capital requirement is a direct result of the issues that led to our announcement on 9 March. On completion of the fund raise I believe that the Company can have a bright future.”
WANdisco said it will seek to raise the funds by issuing fresh shares in a move that will dilute the holdings of existing shareholders. The firm said the proceeds will help shore up its balance sheet and provide confidence to shareholders, as well as being used to fund marketing and business development work.
Last month, the UK’s finance watchdog said it had begun an investigation into WANdisco amid concerns over fraud. The company said it was cooperating with the requests of. The Financial Conduct Authority.
Just weeks ago, the Sheffield-based tech firm, which also has a base in California, said it was eyeing a listing in the US after it surpassed a $1 billion market cap. But its fortunes quickly turned following the discovery of over $100 million in missing sales bookings, with its CEO and CFO abruptly quitting shortly thereafter. Lever said he was “pleased to now have a world class CEO and CFO in place.”
WANdisco has since said the missing sales related to actions taken by a single employee.
