Nemex Resources has dropped plans to acquire a majority stake in Wavefront Biometric Technologies after losing support from its major shareholders.
Nemex announced today that it had been advised by representatives of its major shareholders that they no longer supported the company’s strategy of acquiring a 50.5 per cent stake in Wavefront, and as a result it has resolved to cancel a $4.8 million capital raising, which was to be managed by Subiaco-based Cicero Advisory Services.
As a result, Australian property investment platform BrickX co-founder and former chief executive Darren Patterson has withdrawn from his proposed role as CEO of Nemex, while Nemex chairman Patrick Flint withdrew his nomination for re-election at the company’s annual general meeting today.
However, the company said in a statement that it was proposed that Beijing-based Tao Ding would be appointed to the board following the AGM, with another board appointment to be made before the end of the year.
Mr Ding is a Chinese national and is general manager of an unnamed technology company, which is focused on IT integration and services.
Nemex announced in June plans to buy the remaining 60 per cent worth of shares it didn’t already own in Wavefront, complete a $5 million capital raising and relist on the ASX as a tech company.
However the deal was amended in October with Nemex instead proposing to increase its stake in Wavefront from 40 per cent to 51 per cent in a deal worth $1.75 million.
Wavefront had facilitated a review of its flagship technology through the International Centre for Biometric Research at Pardue University, but announced to Nemex last month that the testing was unable to validate and report on certain system performance metrics.
“Nemex intends to assist Wavefront with respect to resolving the uncertainty associated with the recent Pardue ICBR testing, and introduce Wavefront to potential technology development partners in China,” Nemex said in a statement today.
“Subject to successful completion of these activities, Nemex would then seek shareholder approval under ASX listing rules for a significant change to the nature and scale of its activities, and would aim to re-comply with relisting rules.”
Nemex closed 4.7 per cent lower to 2 cents each.