A life sciences firm that received millions in Welsh Government funding is delisting as part of plans for it to exit administration as a going concern.

Alternative Investment Market (AIM) isted stem cell development firm ReNeuron, based in Bridgend, entered administration in March. It had received a £5m equity investment from the Welsh Government’s £50m Wales Life Sciences Investment Fund (WLSIF) back in 2013 – as part of a £25m equity round also supported by institutional investors Abingworth and Invesco.


Read More: Latest equity deals in Wales

Read More: The huge cost of workplace bullying

At the same time Welsh Government also announced a £7.8m grant package to support its relocation from Guildford to Pencoed to establish a cell manufacturing and development facility.

With the pre-revenue firm experiencing cashflow issues, and failing to raise new investment, Stephen Cork and Mark Smith of Cork Gully LLP were appointed joint administrators of the loss-making firm.

Efforts to secure agreeable investment terms for it to exit administration and remain on AIM couldn’t be achieved.

In a statement the company said: “In view of the limited quantum of funds identified to date and the terms of those potential investors, the board of ReNeuron has determined that it is not in the interests of existing shareholders to progress with a highly dilutive fundraise and continue to incur the additional costs and regulatory obligations of being listed on AIM.”

ReNeuron will delist on Monday. Trading in its shares have been suspended since it entered administration. The aim is to now strike a deal with creditors to allow it to exit administration as a private company – although this is not guaranteed.

The joint administrators will continue discussions with creditors to seek to determine the solvency of the business. Once this has been determined, in consultation with the board, will decide the appropriate course of action.

ReNeuron, added: “There are a number of possible options available to the company, including, but not limited to, continuation as a private company.

“On the assumption that the joint administrators can secure documented agreements with the key outstanding creditors, the board intends to exit administration as private company.

“Post administration, the company proposes to continue with a small team lead by Iain Ross and Randolph Corteling and will have sufficient cash to exploit and potentially commercialise specific unencumbered research assets, intellectual property and existing licences to form the basis of a standalone development and licensing business and thereby create an immediate increase in shareholder value and ultimately help to secure an exit for the business.”

The now fully invested WLSIF was championed by Port Talbot-born life sciences investor and serial entrepreneur Sir Chris Evans and then Economy Minister Edwina Hart.

In a procurement process overseen by Finance Wales (now the Development Bank of Wales, the contract to manage the fund was awarded to a company called Arthurian Life Sciences, which was chaired Sir Chris. It was subsequently managed by Arix Capital Management following the acquisition of Arthurian by Arix Bioscience.

Last year the management of the fund’s remaining investments came under the Development Bank of Wales as part of its winding down, after £27m worth of investment had been written off. Its performance was labelled a “national embarrassment” by the Tories.

Sir Chris participated in the 2013 investment round into ReNeuron in a personal capacity.

The fund’s biggest hit came with the collapse in 2022 of proton beam cancer treating centre business, Rutherford Health, in which it had invested £10m in equity as part of a £100m investment round in 2015.

There was one notable success for the fund with its equity investment into Merthyr-based drug trial specialist Simbec Orion. Having invested more than £8.75m into Simbec, its subsequent acquisition through a private equity financed management buyout in 2019 generated a £20m capital return to the Welsh Government – after the proceeds from the exit were passed back to it by the Development Bank of Wales.

There was no requirement for the fund manager to match fund the £50m, but the 11 investments into nine firms made by the WSLIF leveraged a further £200m of private sector investment.

The development bank has since realised a £27m loss on the fund.