RAMCap wants to turn Factor Therapeutics into a hedge fund business
Health & Biotech
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Is relief finally in sight for long suffering shareholders of Factor Therapeutics (ASX:FTT)? Quite possibly — small cap-focused hedge fund RAMcap wants to take over the company.
Factor has been in the doldrums since November 2018 when it’s wound-dressing drug failed a clinical trial leading to shares plunging over 95 per cent.
Ever since, the company has been looking for new opportunities in the life sciences sector. But none of these have gone beyond due diligence nor have specific details on any been provided.
But RaMcap has a different plan: to turn Factor into a hedge fund manager called Stairway Funds.
RAMcap plans to replace all but one of its board members with its own and both itself and Factor will invest $200,000 each for a 50 per cent stake. It wants a return of 150 per cent of the All Ords Index over a three-year period.
RAMcap boasts that it has made $3.2m from investment capital of $2.2m in just two years using contracts for difference (CFDs). It also claims to have a big interest in gold stocks right now and three of the company’s gold holdings have attracted takeover interest.
After five years RAMCap is aiming to have $269m in funds management (FUM). Similar to other takeover bidders during COVID-19, it says the deal provides certainty in times of uncertainty.
On Friday afternoon, the Factor board responded to the offer. Chair Dr Cherrell Hirst has requested more information but isn’t enticed by the offer just yet.
“Based on the information received to date the company would not recommend this proposal to shareholders,” she said.