Cloudtag's shares plunge after £975,000 subscription, Nomad resignation

Shares in Cloudtag plunged more than 30% as it said its nominated adviser had resigned, and that it has raised £975,000 in a subscription at 3.75p a share.

The subscription, for 26m new shares, would produce net proceeds of £916,500, which would be used for general working capital purposes.

"The company is pre-revenue generating and is therefore dependent on its ability to raise further capital to continue its operations in the short term," said Cloudtag.

"The board is carefully managing the Company's cash position," it said.

In addition, in order to allow the Cloudtag to issue further new ordinary shares, the company intends to convene an EGM at which a resolution will be put to shareholders to dis-apply pre-emption rights.

"Following receipt of the Net Proceeds an application will be made for the admission of the subscription shares to trading on AIM and it is expected that dealings in the shares will commence on or around 2 March 2017," it said.

Meantime, Cloudtag also said nominated advisor Cairn Financial Advisers LLP has resigned, effective from 10 April 2017. It was in talks with another Nomad and broker, and was optimistic a replacement would be appointed prior to 10 April 2017.

At 10:51 GMT, shares in AIM-listed Cloudtag were down 30.77% to 3.38p each.