AdvancedAdvT Limited

11 March 2022

LEI: 254900WYO35S1T334A28

AdvancedAdvT Limited

("AdvancedAdvT" or the "Company")

Unaudited Interim Report for the period ended 31 December 2021

The Company announces its unaudited interim results for the period ended 31 December 2021.

 Overview

•      The Company has been formed for the purpose of effecting a merger, share exchange, asset acquisition, share or debt purchase, reorganisation or similar business combination with one or more businesses, to generate attractive long term returns for shareholders and to enhance value by supporting sustainable growth, acquisitions and performance improvements within the acquired companies.

•      The Company remained focused on executing its objective of completing a business combination with one or more businesses, by seeking and actively evaluating a number of high-quality targets.

•      The Board believes the trend to increased data creation and digitalisation of business processes and operations will continue to present investment opportunities for high-quality businesses with the potential to generate long-term value.

•      On 5 January 2022, the Company acquired a c9.82 per cent shareholding in M&C Saatchi PLC ("M&C"), which triggered the current suspension of trading in the Company's shares on the London Stock Exchange. The Company viewed this as an attractive investment opportunity in a market which is experiencing significant digital transformation and growth.

•      The Company remains in discussion with M&C with respect to a possible merger; further announcements will be made as and when appropriate. There can be no certainty that a firm offer under Rule 2.7 of The City Code on Takeovers and Mergers (the "Code") will be made for M&C.

•      The Group reported a loss of £0.2m for the six-month period to 31 December 2021 arising from administrative expenses net of interest income earned on its cash resources.

•      Net cash at the period end was £129.2m.

Chairperson's statement

Fellow Shareholders, the last 6 months of 2021 continued to be a productive period for AdvancedAdvT. We remained focused on our objective to complete a business combination and generate attractive long term returns for shareholders.

The high availability of capital and appetite for premium-quality businesses, has to date created a very competitive environment and resulted in increased valuations. Our ability to identify opportunities early combined with significant capital and a flexible share structure, which can facilitate a broad range of future transactions, continue to be core elements of our proposition.

Covid-19 has accelerated the adoption of technology and removed perceived barriers. We believe the trend to increased digitalisation of business processes, operations and engagement will continue as we return to a new normal. Businesses will seek to maintain competitiveness, improve their users experience and deliver on productivity and ESG mandates. Businesses enabling these outcomes through digital products will be expected to maintain an increased demand for their offerings.

The Company has been conducting a thorough market search, engaging with multiple advisors, across both private and public markets. We have continued to measure each opportunity against a common set of characteristics which help identify underlying value with significant addressable market and potential.

The Company acquired a c.9.82 per cent shareholding in M&C on the 5 January 2022 and subsequently entered discussions with the board of M&C exploring an opportunity for a possible merger. Further announcements will be made as and when appropriate. There can be no certainty that a firm offer under Rule 2.7 of the Code will be made for M&C.

Vin Murria OBE
Chairperson
10 March 2022

Enquiries: 

Company Secretary

Antoinette Vanderpuije - 020 7004 2743

Meare Consulting (Financial PR to the Company)

Adrian Duffield - 07990 858548 

Singer Capital Markets - Broker - 020 7496 3000

Phil Davies

George Tzimas

The Interim Report is also available on the 'Shareholder Documents' page of the Company's website at www.advancedadvt.com and the National Storage Mechanism at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

Management Report

Herewith are the unaudited interim condensed consolidated financial statements of AdvancedAdvT Limited (formerly Marwyn Acquisition Company I Limited) (the "Company") for the six months to 31 December 2021 (the "Consolidated Interim Financial Statements"), consolidating the results of AdvancedAdvT Limited and MAC I (BVI) Limited (collectively, the "Group").

Activity, Strategy & Outlook

The Company was formed to seek and identify situations where a merger of management expertise, improving operating performance, freeing up cashflow for investment and implementation of focused investment and M&A strategy can unlock growth in their core markets and often into new territories and adjacent sectors.

The Company's objective is to generate attractive long term returns for shareholders and to enhance value by supporting sustainable growth, acquisitions and performance improvements within the acquired companies.

Over the last 25 years companies across all sectors have increasingly adopted new digital technologies to optimise business processes and operations. Implementing these new technologies has become central to driving cost efficiencies and gaining a competitive advantage in a digital world, where sectors and businesses with the highest level of digitalisation display the largest productivity growth.

Despite the opportunities presented by digitalisation, pre-Covid-19 adoption of new technologies by businesses and consumers was in part restricted by the reticence of companies to invest in digital strategies and adopt new systems and technologies.

The global restrictions caused by Covid-19 have helped to break down these barriers and forced businesses to become more agile which has considerably accelerated digitalisation. Despite businesses cutting costs because of the Covid-19 pandemic, spending on digital transformation has increased as organisations rapidly adapt their business models. A McKinsey study[1] found that the pandemic had sped up the adoption of digital technologies by several years, and that most companies will need to build new digital businesses to stay economically viable.

We therefore believe there is significant opportunity to invest in companies that are positioned to take advantage of the structural change arising from an unprecedented acceleration of digitalisation brought about by the current macroeconomic environment, affecting the way people live, work and consume, and the way businesses operate, engage and sell to customers.

The Company may either consider acquiring total voting control of any target company or business or acquiring a non-controlling interest constituting less than total voting control or less than the entire equity interest of that target company or business if such opportunity is considered attractive or where the Company expects to acquire sufficient influence to implement its strategy. In such circumstances, the remaining ownership interest will be held by third parties and the Company's decision-making authority may be limited. Any third party's interests may be contrary to the Company's interests.

The management team have significant experience in the technology sector having invested in and/or operated a range of high performing software and digital services businesses. Management has successfully driven operational excellence within these businesses to deliver organic growth and has a track record of carrying out targeted accretive M&A in the software sector, having completed more than 85 acquisitions between them.

On 5 January 2021, the Company acquired 12,000,000 ordinary shares of M&C at a price of £2.00 per share, representing a non-controlling interest of c.9.82 per cent. of the current issued share capital of M&C, a business which the Board believes is well positioned to take advantage of the structural change arising from an acceleration of digitalisation brought about by the current macroeconomic environment. The Company views this as a good investment opportunity and has subsequently entered discussions with the board of M&C exploring an opportunity for a possible merger. There can be no certainty that a firm offer under Rule 2.7 of the Code will be made for M&C. The Company has significant deployable capital to pursue its stated strategy with, or without, M&C.

Results                                                                                               

The Group's loss after taxation for the six months to 31 December 2021 was £218,548 (period to 31 December 2020 loss £246,976[2]). The Group held a cash balance at the period end of £129,231,390.

Dividend Policy

The Company has not yet acquired a trading operation and it is therefore inappropriate to make a statement on the likelihood of any future dividends. The Directors intend to determine the Company's dividend policy following completion of a platform acquisition and, in any event, will only commence the payment of dividends when it becomes commercially prudent to do so.

Corporate Governance

As a company with a Standard Listing, the Company is not required to comply with the provisions of the UK Corporate Governance Code. Nevertheless, the Board is committed to maintaining high standards of corporate governance and will consider whether to voluntarily adopt and comply with the UK Corporate Governance Code as part of any acquisition, taking into account the Company's size and status at that time.

The Company currently complies with the following principles of the UK Corporate Governance Code:

·      The Company is led by an effective and entrepreneurial Board, whose role is to promote the long term sustainable success of the Company, generating value for shareholders and contributing to wider society.

·      The Board ensures that it has the policies, processes, information, time and resources it needs in order to function effectively and efficiently.

·      The Board ensures that the necessary resources are in place for the company to meet its objectives and measure performance against them.

Given the size and nature of the Company, the Board has not established any committees and intends the Board as a whole would make decisions. If the need should arise in the future, for example following any acquisition, the Board may set up committees as appropriate.

Risks

The Directors have carried out a robust assessment of the principal risks facing the Group including those that would threaten its business model, future performance, solvency or liquidity. The Company has published its principal risks in the Company's prospectuses dated 4 December 2020 and 18 March 2021 and the principal risks are also set out in the Company's audited financial statements to 30 June 2021. The Directors are of the opinion that the risks detailed in the Company's prospectus dated 18 March 2021, the audited financial statements to 30 June 2021, and those risks detailed below, are applicable for the remaining six months of the financial year. Details of the risks faced by the Group are set out on pages 11-20 of the prospectus dated 18 March 2021  which can be found on the Company's website www.advancedadvt.com.

The Company's sole non-cash asset is a minority shareholding in M&C Saatchi

The value of the Company's holding of shares in M&C remains subject to typical risks associated with the holding of shares in listed equity securities. The investment in M&C will be accounted for as an asset held at fair value and will be revalued to market value at the end of every reporting period with gains or losses on revaluation taken to the statement of comprehensive income. Further, any fall in the share price of M&C would have a corresponding negative effect on the value of the M&C investment.

Readmission may not take place or may not take place when expected.

As the investment in M&C constituted a reverse takeover under the Listing Rules, trading in the Company's  ordinary shares have been suspended. The Company is in discussions with the FCA and the London Stock Exchange regarding the re-admission of the Company's shares to trading on the London Stock Exchange.  The application for Readmission is subject to the approval (subject to satisfaction of any conditions which are attached to such approval) of the FCA and the London Stock Exchange.

Responsibility Statement

Each of the Directors confirms that, to the best of their knowledge:

(a) these Consolidated Interim Financial Statements, which have been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and

(b) these Consolidated Interim Financial Statements comply with the requirements of DTR 4.2

Neither the Company nor the Directors accept any liability to any person in relation to the interim financial report except to the extent that such liability could arise under applicable law.

Details on the Company's Board of Directors can be found on the Company website at www.advancedadvt.com.

Vin Murria OBE
Chairperson
10 March 2022

Condensed Consolidated Statement of Comprehensive Income

The Group's activities derive from continuing operations.

Condensed Consolidated Statement of Financial Position

The financial statements were approved by the Board of Directors on 10 March 2022 and were signed on its behalf by:

Vin Murria                                                                              James Corsellis

Chairperson                                                                           Director