XLON:INAC ESEF Annual Report
InvestAcc Group Limited (XLON:INAC)
ESEF Annual Report
2022-10-24
For: 2022-06-30
View Original
Added on
October 03, 2026
MARWYN ACQUISITION COMPANY II LIMITED
Consolidated Financial Statements
For the year ended 30 June 2022
CONTENTS
1
Management Report 2
Responsibility Statement 10
Independent Auditors’ Report 12
Consolidated Statement of Comprehensive Income 16
Consolidated Statement of Financial Position 17
Consolidated Statement of Changes in Equity 18
Consolidated Statement of Cash Flows 19
Notes to the Consolidated Financial Statements 20
Advisors 36
MANAGEMENT REPORT
2
We present to shareholders the audited consolidated financial statements of Marwyn Acquisition Company II
Limited (the “Company”) for the year ended 30 June 2022 (the “Financial Statements”), consolidating the results
of Marwyn Acquisition Company II Limited and its subsidiary, MAC II (BVI) Limited (collectively, the “Group”).
Strategy
Marwyn Acquisition Company II is an acquisition vehicle listed on the standard segment of the London Stock
Exchange. The vehicle is led by Chairman Mark Hodges, who was previously CEO of ReAssure, prior to which he
held senior executive plc board positions at a number of large financial services and consumer businesses
including Centrica, Towergate and Aviva.
The Company is backed by Marwyn who have launched 11 previous comparable acquisition vehicles that have
acquired platform businesses, which include Advanced Computer Software, BCA Marketplace, Breedon
Aggregates and Entertainment One.
The company is pursuing its stated investment strategy of seeking acquisition opportunities in the financial
services, consumer and technology sectors.
The Directors believe that the current market backdrop has, amongst a range of drivers, four notable interrelated
themes, shaping a clear customer need that remains largely unmet.
1. Changing Population and demographics
Per recent estimates, there are currently 21 million people aged 55 and over in the UK (2020) and 99 million
people aged 55 and over in the US (2021). This global trend is likely to have a significant impact on
economies, social care systems and household finances and the Directors believe future financial solutions
will need to reflect an increasing level of intergenerational financial and social dependencies with financial
products, advice and life solutions needing to be tailored to meet a spectrum of complex multi-generational
needs.
2. Wealth transfer and the role of families
Intergenerational wealth transfer is expected to exceed US$68 trillion, with £5.5 trillion of this in the UK,
underpinning the increasing importance of the role played by families in providing future financial solutions.
· In the UK, one in every two first-time buyers aged under 35 is receiving financial support from their
parents;
· 71% of these new homeowners say they would not have been likely to buy without financial support
from family or friends;
· 75% of parents provide financial support to children who have left home;
· 43% of parents with children aged 30+ say they are helping them financially;
· In the US in 2018, families and friends supported one in every five existing home buyers with the
purchase of 1.2 million homes, financing US$317 billion worth of homes; and
· US parents are spending US$500 billion on their adult children per annum.
3. Social and non-financial family support
· 5.4 million people in the UK provide unpaid care for a friend or family member with over 1.4 million
people providing fifty or more hours of care per week. The peak age of carers in the UK is 55-64 with
29% of adults providing care and 22% of people aged over 65 providing unpaid care.
· In the US, where 53 million people are providing unpaid care to an adult with health or functional needs.
61% of these carers are fully employed and 45% say caregiving had at least one financial impact (e.g.
stopped saving or took on more debt).
· 10 million caregivers (25% of US caregivers) fall into the millennial age range (22-37), of which, 73% are
employed but also spend an average of 21 hours a week caring for loved ones.
4. Concentration of wealth
· In the UK, household wealth is principally concentrated in property (36%) and pension assets (42%);
· In the US, household wealth is similarly concentrated in pensions (20%), real estate (24%) and equities
(27%).
MANAGEMENT REPORT
3
Opportunities for a new approach to family-focussed financial solutions
With the combination of these social and macroeconomic conditions and trends, the Directors believe all
generations are facing increasingly challenging financial situations which are creating several problems to be
solved. The Directors believe there is a well-defined need and opportunity, now more than ever, for clear and
impartial support and solutions to be provided to, and shared amongst, friends, family and peers.
Strategy Execution
The Company intends to execute its strategy through a combination of selective M&A of platform and bolt-on
businesses, potential strategic partnerships with established financial services operators as well as ongoing
operational improvements. Target company market segments, principally expected to be in the UK and US, may
include, but are not limited to:
· FinTech digital platforms;
· Digital content platforms;
· Life and pensions;
· Life-insurance assets;
· Lifetime mortgages and equity release;
· Wealth managers and advisers;
· Brokerage and associated services;
· Mortgage advisory;
· Healthcare related services;
· Estate planning and associated legal and tax services; and
· Later life planning and assisted care services.
Activity
The Company was incorporated on 31 July 2020 and subsequently listed on the Main Market of the London Stock
Exchange on 4 December 2020. 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. 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.
On 29 March 2022, the Company announced the launch of a 12-month placing programme (the “Placing
Programme”) pursuant to which the Company has the ability to issue up to 500 million C ordinary redeemable
shares (“C Shares”) at an issue price of £1 per C share in order to raise up to an aggregate of £500 million.
On 20 June 2022, the Company announced the appointment of Mark Hodges as Chairman. In connection with
this appointment, the strategy of the Company was refined as set out above. Mark Hodges’ biography is set out
on page 4. During the year and to the date of this report, the Company has continued to assess potential
acquisition opportunities in line with its stated strategy.
Results
The Group’s total comprehensive loss for the year to 30 June 2022 was £1,934,518 (period ended 30 June 2021:
£636,096). Of the costs incurred in the year, £793,214 (period ended 30 June 2021: £263,769) relates to non-
recurring project costs. The Group held a cash balance at the year end of £10,254,198 (2021: £12,255,387). The
Group has not yet acquired an operating business and as such is not yet income generating.
In connection with the Company’s ongoing activities, an asset has been recorded for costs associated with a
further equity raise at the balance sheet date as disclosed in Note 10. There is currently no certainty that the
potential capital raise will take place nor of its terms should it do so.
Directors
The Directors during the year and subsequently are:
Mark Hodges (Chairman) – appointed 19 June 2022
James Corsellis – stepped down as Chairman effective 19 June 2022 and remains a director of the Company
Mark Brangstrup Watts
MANAGEMENT REPORT
4
Directors’ Biographies
Mark Hodges
Mark Hodges is the Chairman of the Company and has over 30 years’ experience across the financial services
and consumer sectors, including extensive FTSE 100 PLC board experience with Centrica plc and Aviva plc. As
former CEO of ReAssure, Mark led the business through the £425m acquisition of Quilter’s UK Heritage business
and oversaw the sale of Reassure to Phoenix Group Holdings in 2020 for £3.25bn. At the time of the sale,
ReAssure had approximately £80bn of assets under administration, 4 million customers and approximately 2,500
employees.
Previously, Mark was CEO of Centrica’s £11bn revenue consumer division, which included British Gas in the UK,
Bord Gais in Ireland, Direct Energy in the US and Hive globally. Mark was hired from outside the energy sector
as a change agent to simplify and modernise the business to make it more efficient, more customer-focused and
less product-led. Mark’s mandate included the improvement of digital channels, the growth of new revenue
streams, and to drive cultural change. During his tenure, Mark oversaw a growth in the Hive customer base from
approximately 200,000 customers to more than 1.3 million.
Before this, Mark led Towergate Insurance, a 5,000-employee business with revenue of more than £400m and
serving approximately 2 million customers. Mark was responsible for formulating the group strategy and
oversaw the acquisition of 50 specialist insurance businesses, significantly bolstered the new executive team and
management below executive level, oversaw the complete rebuild of governance and operational control
frameworks to bring in line with regulatory standards, and carried out a fundamental operational restructuring,
including the establishment of a market leading 400 person contact centre in Manchester.
Mark previously spent more than 20 years with Aviva across a variety of senior finance, planning and strategy
roles, including CEO of UK Life and Pensions and latterly as Aviva UK Chief Executive and board member of Aviva
plc. As CEO of Aviva UK, Mark led a business with annual revenues of £15bn, £1.4bn in operating profits, and
approximately 20,000 staff. Mark’s highlights at Aviva include the creation of a new strategy for the UK business
and implementation of a new operating model to create the largest composite insurer in the UK that saw a return
to growth of the General Insurance business, developing a vision for the integrated UK business that generated
significant annual cost savings and led to sustained outperformance of the UK Life Business, and leading the
turnaround in the UK Life Insurance business to deliver growth, reduced costs, improved profitability, improved
customer service (NPS), and improved people engagement as well as overseeing the brand change from Norwich
Union to Aviva. During his tenure with Norwich Union, Mark was involved in the acquisition of London &
Edinburgh in 1996, demutualised and floated Norwich Union on the London Stock Exchange in 1997 and merged
with CGU in 2000. He subsequently oversaw the acquisition of RAC PLC in 2005 for £1.25bn
James Corsellis
James brings extensive public company experience as well as management and corporate finance expertise
across a range of sectors and an extensive network of relationships with co-investors, advisers and other business
leaders.
Previously James has served as a director of the following companies: a non-executive director of BCA
Marketplace Limited (formerly BCA Marketplace Plc) from July 2014 to December 2017, Advanced Computer
Software from October 2006 to August 2008, non-executive chairman of Entertainment One Limited from
January 2007 to March 2014 and remaining on the board as a non-executive director until July 2015, non-
executive director of Breedon Aggregates Limited from March 2009 to July 2011 and as CEO of icollector Plc from
1994-2001 amongst others. James was educated at Oxford Brookes University, the Sorbonne and London
University.
James is a managing partner of Marwyn Capital LLP and Marwyn Investment Management LLP, an executive
director of Silvercloud Holdings Limited, and the chairman of Marwyn Acquisition Company Plc, Marwyn
Acquisition Company III Limited and MAC Alpha Limited.
MANAGEMENT REPORT
5
Mark Brangstrup Watts
Mark has many years of experience deploying long term investment strategies in the public markets. Mark brings
his background in strategic consultancy to the management team, having been responsible for strategic
development projects at a range of international companies including Ford Motors Company (US), Cummins
(Japan) and 3M (Europe).
Previously Mark has served a director of the following companies: a non-executive director of Zegona
Communications Plc from January 2015 to May 2020, BCA Marketplace Limited (formerly BCA Marketplace Plc)
from July 2014 to December 2017, Advanced Computer Software from October 2006 to September 2012,
Entertainment One Limited from June 2009 to July 2013, Silverdell Plc from March 2006 to December 2013,
Inspicio Holdings Limited from October 2005 to February 2008 and Talarius Limited September 2005 to February
2007 amongst others. Mark has a BA in Theology and Philosophy from King’s College, London.
Mark is a managing partner of Marwyn Capital LLP and Marwyn Investment Management LLP, an executive
director of Silvercloud Holdings Limited, and a director of Marwyn Acquisition Company Plc, Marwyn Acquisition
Company III Limited, MAC Alpha Limited and AdvancedAdvT Limited.
Dividend Policy
The Company has not yet acquired a trading business and it is therefore inappropriate to make a forecast of the
likelihood of any future dividends. The Directors intend to determine the Company’s dividend policy following
completion of an acquisition and, in any event, will only commence the payment of dividends when it becomes
commercially prudent to do so.
Key Performance Indicators
The Company has not yet acquired a trading business and therefore no key performance indicators have been
set as it is inappropriate to do so.
Stated Capital
Details of the stated capital of the Company during the year are set out in Note 14 to the Financial Statements.
On 4 December 2020 the Company issued 700,000 ordinary shares and matching warrants for a total price of
£700,000. 75% of the ordinary shares and matching warrants were issued to an entity managed by Marwyn
Investment Management LLP (“MIM LLP”), the remaining 25% were issued to senior executive managers of
previous successful acquisition companies launched by Marwyn.
On 20 April 2021, the Company issued 12 million A shares to an entity managed by MIM LLP (with class A warrants
being issued on the basis of one class A warrant per A share), for a total price of £12,000,000.
On 29 March 2022, the Company announced the launch of the Placing Programme pursuant to which the
Company has the ability to issue up to 500 million C Shares at an issue price of £1 per C share in order to raise
up to an aggregate of £500 million. As at the date of these Financial Statements, no C Shares have been issued.
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 and given the size and nature of the Group the Directors have decided not to adopt
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.
MANAGEMENT REPORT
6
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; and
• 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 to make
decisions as a whole. If the need should arise in the future, for example following any acquisition, the Board may
set up committees and may decide to comply with the UK Corporate Governance Code.
Risk management and internal control systems
A robust risk assessment was carried out by the Directors of the Company, along with its advisers, in preparation
for the Company’s IPO on 4 December 2020 and the Directors have identified a wide range of risks, which are
set out in the Company’s prospectus dated 4 December 2020. As part of the launch of the Placing Programme
an updated robust risk assessment was carried out by the Directors of the Company, along with its advisers and
the wide range of risks identified are set out in the Company’s prospectus dated 31 March 2022.
The Company’s prospectuses are available on the Company’s website: www.marwynac2.com.
The Company’s risk management framework incorporates a risk assessment that identifies and assesses the
strategic, operational and financial risks facing the business and mitigating controls. The risk assessment is
documented through a risk register which categorises the key risks faced by the business into:
• Business risks;
• Shareholder risks;
• Financial and procedural risks; and
• Risks associated with the acquisition process.
The risk assessment identifies the potential impact and likelihood of each of the risks detailed on the risk register
and mitigating factors/actions have also been identified.
The Company’s risk management process includes both formal and informal elements. The size of the Board and
the frequency in which they interact ensures that new risks, or changes to the nature of the Company’s existing
risks, are identified, discussed and analysed quickly. The Company’s governance framework, including formal
periodic board meetings with standing agendas, ensures that the Company has a formal framework in place to
manage the review, consideration and formal approval of the risk register, including risk assessment.
The Group’s only significant asset is cash. As at the statement of financial position date the Group’s cash balance
was £10,254,198 (2021: £12,255,387). Price, credit, liquidity and cashflow risk are not considered to be
significant due to the simple nature of the Company’s assets and liabilities and the current activities undertaken
by the Group. The Directors have reviewed the risk of holding a singular concentration of assets and do not deem
this a material risk, as set out in Note 16 of these financial statements. The Directors have set out below the
principal risks faced by the business. These are the risks the Directors consider to be most relevant to the
Company based on its current status. The risks referred to below do not purport to be exhaustive and are not
set out in any particular order of priority.
MANAGEMENT REPORT
7
Key risk
Explanation
The Company could
incur costs for
transactions that
may ultimately be
unsuccessful.
There is a risk that the Company may incur substantial legal, financial and advisory
expenses arising from unsuccessful transactions which may include public offer and
transaction documentation, legal, accounting and other due diligence which could
have a material adverse effect on the business, financial condition, results of
operations and prospects of the Company.
The Company may
not be able to
complete an
acquisition.
The Company's future success is dependent upon its ability to not only identify
opportunities but also to execute a successful acquisition. There can be no assurance
that the Company will be able to conclude agreements with any target business and/or
shareholders in the future and failure to do so could result in the loss of an investor's
investment. In addition, the Company may not be able to raise the additional funds
required to acquire any target business, fund future operating expenses after the initial
twelve months, or incur the expense of due diligence for the pursuit of acquisition
opportunities in accordance with its investment objective.
The Company may
face significant
competition for
acquisition
opportunities.
There may be significant competition for some or all of the acquisition opportunities
that the Company may explore. Such competition may for example come from
strategic buyers, sovereign wealth funds, special purpose acquisition companies and
public and private investment funds, many of which are well established and have
extensive experience in identifying and completing acquisitions. A number of these
competitors may possess greater technical, financial, human and other resources than
the Company. Therefore, the Company may identify an investment opportunity in
respect of which it incurs costs, for example through due diligence and/or financing,
but the Company cannot assure investors
that it will be successful against such
competition. Such competition may cause the Company to incur significant costs but
be unsuccessful in executing an acquisition or may result in a successful acquisition
being made at a significantly higher price than would otherwise have been the case
which could materially adversely impact the business, financial condition, result of
operations and prospects of the Company.
Even if the Group
completes the
Business
Acquisition, any
technological,
strategic, operating
and financial
improvements
proposed and
implemented may
not be successful.
The success of any of the Group’s acquisitions may depend in part on the Group’s
ability to implement the necessary technological, strategic, operational and financial
change programmes in order to transform the acquired business and improve its
financial performance. Implementing change programmes within an acquired business
may require significant modifications, including changes to hardware and other
business assets, operating and financial processes and technology, software, business
systems, management techniques and personnel, including senior management.
There is no certainty that the Group will be able to successfully implement such change
programmes within a reasonable timescale and cost, and any inability to do so could
have a material adverse impact on the Company’s performance and prospects.
Specifically, in the context of operational improvements and financial performance,
the Company may not be able to propose and implement effective operational
improvements for the target business with which the Group completes an acquisition.
Such target businesses may not be able to generate the expected margins or cash
flows. Although the Group assesses each target business, these assessments are
subject to a number of assumptions and estimates concerning markets, profitability,
growth, interest rates and company and asset valuations. The Group’s assessments of,
and assumptions regarding, target businesses may prove to be incorrect and actual
developments may differ significantly from the Group’s expectations. In addition, even
if the Group completes an acquisition, general economic and market conditions or
other factors outside the Company’s control make the Company’s operating strategies
difficult or impossible to implement.
MANAGEMENT REPORT
8
Directors interests
The Directors have no direct interests in the ordinary shares of the Company. The Directors have interests in the
Company’s long term incentive plan, as detailed in Note 17 to the Financial Statements. James Corsellis and Mark
Brangstrup Watts are managing partners of MIM LLP which manages 75% per cent of the ordinary shares and
matching warrants, and 100% of the A shares and matching A warrants issued by the Company. James Corsellis
and Mark Brangstrup Watts are also managing partners of Marwyn Capital LLP, a firm which provides corporate
finance, company secretarial and ad-hoc managed services support to the Company. Details of the related party
transactions which occurred during the year are disclosed in Note 18 to the Financial Statements, save for the
participation in the Company’s long term incentive plan as disclosed in Note 17 to the Financial Statements.
There were no loans or guarantees granted or provided by the Company and/or any of its subsidiaries to or for
the benefit of any of the Directors.
Statement of Going Concern
The Financial Statements have been prepared on a going concern basis, which assumes that the Group will
continue to be able to meet its liabilities as they fall due for the foreseeable future. The Directors have considered
the financial position of the Group and have reviewed forecasts and budgets for a period of at least 12 months
following the approval of the Financial Statements.
At 30 June 2022, the Group has net assets of £8,247,216 (2021: £10,180,565) and a cash balance of £10,254,198
(2021: £12,255,387). The Company has sufficient resources to continue to pursue its investment strategy which
may include effecting a merger, share exchange, asset acquisition, share or debt purchase, reorganisation or
similar business combination with one or more businesses. Subject to the structure of any acquisition, the
Company may need to raise additional funds to finance the acquisition in the form of equity and/or debt. The
capital structure of the Company enables it to issue different types of shares in order to raise equity to fund an
acquisition. As set out in the Management Report, during 2022, the Company has launched the
PlacingProgramme, under which the Company has the ability to raise up to £500 million via the issuance of C
Shares. No C Shares have yet been issued as at the date of these Financial Statements. The Company can also
raise capital via the issuance of further ordinary shares or via the issuance of unlisted B shares which would be
issued in conjunction with a private placement memorandum to qualifying institutional investors, and
exchangeable into listed ordinary shares on re-admission. The ability of the Company to raise additional funds
in relation to an acquisition may affect its ability to complete that acquisition. Other factors outside of the
Company’s control may also impact on the Company’s ability to complete that acquisition. The key risks relating
to the Company’s ability to execute its stated strategy are set out on page 7.
The Company also entered into a forward purchase agreement (“FPA”) on 27 November 2020 with Marwyn
Value Investors II LP (‘’MVI II LP’’) of up to £20 million, which may be drawn for general working capital purposes
and to fund due diligence costs. Any drawdown is subject to the prior approval of MVI II LP and the satisfaction
of conditions precedent. At 30 June 2022 £12 million had been drawn down under the FPA. Whilst the FPA
provides a mechanism for the Company to raise additional funds, as any drawdown is not under the exclusive
control on the Company, all cashflow and working capital forecasts have been prepared without any further
draw down on the FPA being assumed.
Furthermore, the Directors have considered the ongoing impact of the Covid-19 pandemic, conflict in Ukraine
and current macro-economic factors on the Group’s forecast cashflows and liabilities, concluding that prior to
completing a transaction, these have no material impact on the Group due to the nature of its operations.
The Directors have also considered the ongoing operating costs expected to be incurred by the business over at
least the next 12 months. Based on their review the Directors have concluded that there are no material
uncertainties relating to going concern of the Group and as such the Financial Statements have been prepared
on a going concern basis, which assumes that the Group will continue to be able to meet its liabilities as they fall
due within the next 12 months from the date of approval of the Financial Statements.
Outlook
The Directors believe that the current market backdrop provides a compelling need for a new approach to family-
focussed financial solutions, with the opportunity to build a business through selective M&A and a strategic
vision to address this. The Company continues to progress discussions regarding potential acquisition
MANAGEMENT REPORT
9
opportunities, as well as potential executive management appointments, which the Directors believe can deliver
both the shareholder returns and broader stakeholder benefits that can be generated from a successful
execution of the strategy.
RESPONSIBILITY STATEMENT
10
The Directors are responsible for preparing the consolidated financial statements in accordance with applicable
laws and regulations,
including the BVI Business Companies Act, 2004. The Directors have prepared the financial
statements for the year to 30 June 2022, which give a true and fair view of the state of affairs of the Group and
the loss of the Group for that year.
The Directors have acted honestly and in good faith and in what the Directors believes to be in the best interests
of the Company.
The Directors have chosen to use International Financial Reporting Standards as adopted by the European Union
(“IFRS”) in preparing the Group’s financial statements. International Accounting Standard 1 requires that
financial statements present fairly for each financial year the group’s financial position, financial performance
and cash flows. This requires the faithful presentation of the effects of transactions, other events and conditions
in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses set out in
the International Accounting Standards Board’s “Framework for the preparation and presentation of financial
statements”. In virtually all circumstances, a fair presentation will be achieved by compliance with all applicable
IFRS.
A fair presentation also requires the Directors to:
• select consistently and apply appropriate accounting policies;
• present information, including accounting policies, in a manner that provides relevant, reliable,
comparable and understandable information;
• make judgements and accounting estimates that are reasonable and prudent;
• provide additional disclosures when compliance with the specific requirements in IFRS is insufficient
to enable users to understand the impact of particular transactions, other events and conditions on the
entity’s financial position and financial performance;
• state that the Group has complied with IFRS, subject to any material departures disclosed and
explained in the financial statements; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that
the company will continue in business.
The Directors are also required to prepare financial statements in accordance with the rules of the London Stock
Exchange for companies trading securities on the Stock Exchange.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at
any time the financial position of the Group, for safeguarding the assets, for taking reasonable steps for the
prevention and detection of fraud and other irregularities and for the preparation of financial statements.
Financial information is published on the Group’s website. The maintenance and integrity of this website is the
responsibility of the Directors; the work carried out by the auditor does not involve consideration of these
matters and, accordingly, the auditor’s accept no responsibility for any changes that may occur to the financial
statements after they are presented initially on the website. Legislation in the British Virgin Islands governing
the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Directors’ Responsibilities Pursuant to DTR4
In compliance with the Listing Rules of the London Stock Exchange, the Directors confirm to the best of their
knowledge:
• The Financial Statements have been prepared in accordance with IFRS and give a true and fair view of
the assets, liabilities, financial position and loss of the Group; and
• The management report includes a fair review of the development and performance of the business
and the financial position of the Group, together with a description of the principal risks and
uncertainties that it faces.
RESPONSIBILITY STATEMENT
11
Independent Auditor
Baker Tilly Channel Islands Limited ("BTCI") was appointed as the Company's independent auditor during the
year. BTCI has expressed its willingness to continue to act as auditor to the Group.
Disclosure of Information to Auditor
Each of the Directors in office at the date the Report of the Directors is approved, whose names and functions
are listed in the Report of the Directors, confirm that, to the best of their knowledge:
• so far as they are aware, there is no relevant audit information of which the Group’s auditor is unaware;
and
• they have taken all the steps that they ought to have taken as a Director in order to make themself
aware of any relevant audit information and to establish that the Group’s auditor is aware of that
information.
This Directors’ Report was approved by the Board of Directors on 21 October 2022 and is signed on its behalf.
By Order of the Board
Mark Hodges
Chairman
21 October 2022
INDEPENDENT AUDITOR’S REPORT
12
Independent auditor’s report to the members of Marwyn Acquisition Company II Limited
Opinion
We have audited the consolidated financial statements of Marwyn Acquisition Company II Limited (the
“Company” and, together with its subsidiary, MAC II (BVI) Limited, the “Group”), which comprise the
consolidated statement of financial position as at 30 June 2022, and the consolidated statement of
comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows
for the year then ended, and notes to the consolidated financial statements, including a summary of significant
accounting policies.
In our opinion, the accompanying consolidated financial statements:
• give a true and fair view of the consolidated financial position of the Group as at 30 June 2022, and of its
consolidated financial performance and its consolidated cash flows for the year then ended in accordance
with International Financial Reporting Standards as adopted by the European Union (IFRSs); and
• have been prepared in accordance with the requirements of the BVI Business Company Act 2004, as
amended.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs) and applicable law.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of
the Consolidated Financial Statements section of our report. We are independent of the Group in accordance
with the ethical requirements that are relevant to our audit of the consolidated financial statements in Jersey,
including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the consolidated financial statements of the current period and include the most significant assessed risks of
material misstatement (whether or not due to fraud) identified by us, including those which had the greatest
effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the
engagement team. These matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
Key audit matter
How our audit addressed the
matter
Key observations communicated
to those charged with governance
Equity and Warrants Issuance
The warrants issued to investors
are subject to judgement in both
classification and valuation.
The classification of the warrants is
complex and must consider the
nature and details of the
instruments’
contracts to
determine
the correct
classification between equity and
liabilities.
Further the fair value of these
warrants was determined using
the Black Scholes option pricing
methodology which considered
the exercise price, expected
Our audit procedures included, but
were not limited to:
Classification:
We obtained an understanding of
management’s assessment for the
classification of these instruments
and the rationale for their
classification.
We reviewed, in conjunction with
our Technical Director the
classification of these instruments
and management’s assessment in
accordance with IAS 32 and IFRS 9
and we challeng
ed management
on their assessment.
Based on the procedures
performed, we are satisfied that
management’s judgements and
estimates in respect of the
valuation and classification of
warrants for the year
ended 30
June 2022 along with the related
disclosures in the consolidated
financial statements are
appropriate.
We have nothing to report to those
charged with governance from our
testing.
INDEPENDENT AUDITOR’S REPORT
13
volatility, risk free rate, expected
dividen
ds and expected term of
the warrants which is complex and
involves estimates and
judgements.
Financial Statement Impact:
£2,413,000
Fair Value of Warrants
The accounting policies on pages
22 and 23 sets out the treatment
applied by management, and
related disclosures are presented
in Note 13.
Valuation:
We obtained the valuation report
prepared by management’s
expert.
We performed the review of and
validation of the valuation
assumptions, methodology and
calculations in respect of the
valuation of the instruments and
determined whether it was in
accordance with the requirements
of IFRS 9 and IFRS 13.
Disclosure:
We reviewed the relevant
disclosures in the consolidated
financial statements in accordance
with the requirements of the IFRS
as adopted by the European Union
and performed a financial
statement disclosure checklist
utilising specialist software.
Other matter
The financial statements for the period ended 30 June 2021 were audited by the previous auditor, as listed on
page 35 of the financial statements, who expressed an unmodified opinion on those statements on 29 October
2021.
Our application of Materiality
Materiality for the consolidated financial statements as a whole was set at £211,000, determined with reference
to a benchmark of Net Assets, of which it represents 2.5%.
In line with our audit methodology, our procedures on individual account balances and disclosures were
performed to a lower threshold, performance materiality, so as to reduce to an acceptable level the risk that
individually immaterial misstatements in individual account balances add up to a material amount across the
consolidated financial statements as a whole.
Performance materiality was set at 70% of materiality for the consolidated financial statements as a whole,
which equates to £147,700. We applied this percentage in our determination of performance materiality
because we did not identify any factors indicating an elevated level of risk.
We reported to the Board of Directors any uncorrected omissions or misstatements exceeding £10,550, in
addition to those that warranted reporting on qualitative grounds.
All Group companies were within the scope of testing by the Group audit team.
Conclusions relating to Going Concern
In auditing the consolidated financial statements, we have concluded that the Directors’ use of the going concern
basis of accounting in the preparation of the consolidated financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast significant doubt on the Group and Company’s ability to
continue as a going concern for a period of at least twelve months from when the consolidated financial
statements are authorised for issue.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the
relevant sections of this report.
INDEPENDENT AUDITOR’S REPORT
14
Other information
The other information comprises the information included in the annual report other than the consolidated
financial statements and our auditor's report thereon. The Directors are responsible for the other information
contained within the annual report. Our opinion on the consolidated financial statements does not cover the
other information and, except to the extent otherwise explicitly stated in our report, we do not express any form
of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the consolidated financial statements or our
knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify
such material inconsistencies or apparent material misstatements, we are required to determine whether this
gives rise to a material misstatement in the consolidated financial statements themselves. If, based on the work
performed, we conclude that there is a material misstatement of this other information, we are required to
report that fact.
We have nothing to report in this regard.
Responsibilities of the Directors
As explained more fully in the Directors’ responsibility statement set out on pages 10 and 11, the Directors are
responsible for the preparation of consolidated financial statements that give a true and fair view in accordance
with IFRSs, and for such internal control as the Directors determine is necessary to enable the preparation of
consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Directors are responsible for assessing the Group and
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless management either intends to liquidate the Company or to
cease operations, or has no realistic alternative but to do so.
The Directors are responsible for overseeing the Group’s financial reporting process.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of these consolidated financial
statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:
• Enquiry of management to identify any instances of non-compliance with laws and regulations, including
actual, suspected or alleged fraud;
• Reading minutes of meetings of the Board of Directors;
• Review of legal invoices;
• Review of management’s significant estimates and judgements for evidence of bias;
• Review for undisclosed related party transactions;
• Obtained and reviewed bank statements as well as reviewed ledgers and minutes to ensure finance income
is complete and as per our expectation;
• Using analytical procedures to identify any unusual or unexpected relationships; and
• Undertaking journal testing, including an analysis of manual journal entries to assess whether there were
large and/or unusual entries pointing to irregularities, including fraud.
A further description of the auditor’s responsibilities for the audit of the financial statements is located at the
Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
INDEPENDENT AUDITOR’S REPORT
15
Other matters which we are required to address
We were appointed by Marwyn Acquisition Company II on 23 August 2022 to audit the consolidated financial
statements. Our total uninterrupted period of engagement is 1 year.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group and we remain
independent of the Group in conducting our audit.
Use of this Report
This report is made solely to the Members of the Company, as a body, in accordance with our letter of
engagement dated 22 September 2022. Our audit work has been undertaken so that we might state to the
Members those matters we are required to state to them in an auditor's report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company
and its Members, as a body, for our audit work, for this report, or for the opinions we have formed.
Sandy Cameron
For and on behalf of Baker Tilly Channel Islands Limited
Chartered Accountants
St Helier, Jersey
Date:
21 October 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
16
Loss per share
£’s
£’s
Basic and diluted 8 (0.1523
(0.2130
The Group’s activities derive from continuing operations.
The notes on pages 20 to 35 form an integral part of these Financial Statements.
Year
ended
30 June
2022
Period e
nded
30 June
2021
Note
£’s
£’s
Administrative expenses
6
(1,314,001 )
(636,100 )
Operating loss
(1,314,001 )
(636,100 )
Finance income
Movement in fair value of warrants
13
(635,000 )
Loss before income taxes
(1,934,518 )
(636,096 )
Income tax
7
Loss for the year/period
(1,934,518 )
(636,096 )
Total other comprehensive income
Total comprehensive loss for the year/period
(1,934,518 )
(636,096 )
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
17
The notes on pages 20 to 35 form an integral part of these Financial Statements.
The Financial Statements were approved by the Board of Directors on 21 October 2022 and were signed on its
behalf by:
Mark Hodges
Chairman
James Corsellis
Director
As at
30 June 2022
As at
30 June 2021
Assets
Note
£’s
£’s
Current assets
Other receivables
10
Cash and cash equivalents
11
Total current assets
Total assets
Equity and liabilities
Equity
Ordinary Shares
14
A Shares
14
Sponsor share
14
Share-based payment reserve
17
Accumulated losses
(2,570,614 )
(636,096 )
Total equity
Current liabilities
Trade and other payables
12
Warrants
13
Total liabilities
Total equity and liabilities
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
18
The notes on pages 20 to 35 form an integral part of these Financial Statements.
1
The amounts raised from issuance of ordinary shares and matching warrants and A shares and matching A warrants were required to be split between equity and warrant liability based on the fair value attributable
to these. Therefore, the amounts shown should be considered alongside the warrant liability as detailed in Note 13.
Note
Ordinary
Shares
A Shares
Sponsor
Share
Share
based
payment
reserve
Accumulated
losses
Total equity
£’s
£’s
£’s
£’s
£’s
£’s
Balance at incorporation
-
- - - - -
Issuance of 1 ordinary share
Redesignation of 1 ordinary share
(1 ) - 1 - - -
Issuance of 700,000 ordinary shares
1
14
Share issue costs
14
(275,300 )
(275,300 )
Issuance of 12,000,000 A shares
1
14
Total comprehensive loss for the period
(636,096 )
(636,096 )
Share-based payment charge
17
Balance at 30 June 2021
(636,096 )
Note
Ordinary
Shares
A Shares
Sponsor
Share
Share
based
payment
reserve
Accumulated
losses
Total equity
£’s
£’s
£’s
£’s
£’s
£’s
Balance at 1 July 2021
Total comprehensive loss for the year
(1,934,518 )
(1,934,518 )
Share-based payment charge
17
Balance at 30 June 2022
(2,570,614 )
CONSOLIDATED STATEMENT OF CASH FLOWS
19
For the
year ended
30 June
For the
period ended
30 June
2022
2021
Note
£’s
£’s
Operating activities
Loss for the year
(1,934,518 )
(636,096 )
Adjustments to reconcile total operating loss to net cash flows:
Finance income
(14,483 )
(4 )
Fair Value loss on warrant provision
13
Share-based payment expense
17
Working capital adjustments:
(Increase) in other receivables
(153,652 )
(651,708 )
(Decrease)/Increase in trade and other payables
(596,188 )
Net cash flows used in operating activities
(2,062 ,672 )
(184,318 )
Investing activities
Interest received
Net cash flows received from investing activities
Financing activities
Proceeds from issue of ordinary shares and matching warrants
13
Proceeds from issue of A shares and matching warrants
13
Proceeds from issue of ordinary A share capital in MAC II (BVI)
limited
Costs directly attributable to equity raise
(275,300 )
Net cash flows received from financing activities
Net (decrease)/increase in cash and cash equivalents
(2,001,189 )
Cash and cash equivalents at the beginning of the year/period
-
Cash and cash equivalents at the end of the year/period
11
The notes on pages 20 to 35 form an integral part of these Financial Statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20
1. GENERAL INFORMATION
a BVI business company (registered number 2040956) under the BVI Business Company Act, 2004. The Company
was listed on the Main Market of the London Stock Exchange on 4 December 2020 and has its registered address
at Commerce House, Wickhams Cay 1, P.O. Box 3140, Road Town, Tortola, VG1110, British Virgin Islands and UK
establishment (BR022831) at 11 Buckingham Street, London WC2N 6DF .
has one subsidiary, MAC II (BVI) Limited (together with the Company, the "Group").
2. ACCOUNTING POLICIES
(a) Basis of preparation
The Financial Statements for the year ended 30 June 2022 have been prepared in accordance with International
Financial Reporting Standards and IFRS Interpretations Committee interpretations as adopted by the European
Union (collectively, “IFRS”) and are presented in British pounds sterling, which is the presentational currency of
the Group. The Financial Statements have been prepared under the historical cost basis, except for the
revaluation of certain financial instruments that will be measured at fair value at the end of each reporting year,
as explained in the accounting policies below. The comparative reporting period represents the period from
incorporation, being 31 July 2020, to 30 June 2021.
The principal accounting policies adopted in the preparation of the Financial Statements are set out below. The
policies have been consistently applied throughout the current and prior periods presented.
(b) Going concern
The Financial Statements have been prepared on a going concern basis, which assumes that the Group will
continue to be able to meet its liabilities as they fall due for the foreseeable future. The Directors have
considered the financial position of the Group and have reviewed forecasts and budgets for a period of at least
12 months following the approval of the Financial Statements.
At 30 June 2022, the Group has net assets of £8,247,216 (2021: £10,180,565) and a cash balance of £10,254,198
(2021: £12,255,387). The Company has sufficient resources to continue to pursue its investment strategy which
may include effecting a merger, share exchange, asset acquisition, share or debt purchase, reorganisation or
similar business combination with one or more businesses. Subject to the structure of any acquisition, the
Company may need to raise additional funds to finance the acquisition in the form of equity and/or debt.
The capital structure of the Company enables it to issue different types of shares in order to raise equity to fund
an acquisition. As set out in the Management Report, during 2022, the Company has launched the Placing
Programme, under which the Company has the ability to raise up to £500 million via the issuance of C Shares.
No C Shares have yet been issued as at the date of these Financial Statements. The Company can also raise
capital via the issuance of further ordinary shares or via the issuance of unlisted B shares which would be issued
in conjunction with a private placement memorandum to qualifying institutional investors, and exchangeable
into listed ordinary shares on re-admission. The ability of the Company to raise additional funds in relation to an
acquisition may affect its ability to complete that acquisition. Other factors outside of the Company’s control
may also impact on the Company’s ability to complete that acquisition. The key risks relating to the Company’s
ability to execute its stated strategy are set out on page 7.
The Company also entered into a forward purchase agreement (“FPA”) on 27 November 2020 with Marwyn
Value Investors II LP (‘’MVI II LP’’) of up to £20 million, which may be drawn for general working capital purposes
and to fund due diligence costs. Any drawdown is subject to the prior approval of MVI II LP and the satisfaction
of conditions precedent. At 30 June 2022 £12 million had been drawn down under the FPA. Whilst the FPA
provides a mechanism for the Company to raise additional funds, as any drawdown is not under the exclusive
control on the Company, all cashflow and working capital forecasts have been prepared without any further
draw down on the FPA being assumed.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21
2.’’’ACCOUNTING POLICIES (CONTINUED)
Furthermore, the Directors have considered the ongoing impact of the Covid-19 pandemic, conflict in Ukraine
and current macro-economic factors on the Group’s forecast cashflows and liabilities, concluding that prior to
completing a transaction, these have no material impact on the Group due to the nature of its operations.
The Directors have also considered the ongoing operating costs expected to be incurred by the business over at
least the next 12 months. Based on their review the Directors have concluded that there are no material
uncertainties relating to going concern of the Group and as such the Financial Statements have been prepared
on a going concern basis, which assumes that the Group will continue to be able to meet its liabilities as they fall
due within the next 12 months from the date of approval of the Financial Statements.
(c) New standards and amendments to International Financial Reporting Standards
Standards, amendments and interpretations issued but not yet effective:
The following standards are issued but not yet effective. The Group intends to adopt these standards, if
applicable, when they become effective. It is not currently expected that these standards will have a material
impact on the Group.
Standard
Effective date
Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37);
1 January 2022
Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16);
1 January 2022
Annual Improvements to IFRS Standards 2018-2020 (Amendments to IFRS 1, IFRS 9, IFRS
16 and IAS 41);
1 January 2022
Amendments to IFRS 3: References to Conceptual Framework;
1 January 2022
Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as
Current or Non-current*;
1 January 2023
Disclosure of accounting policies (Amendments to IAS 1);
1 January 2023
Extension of temporary exemption of applying IFRS 9 (Amendments to IFRS 4)
1 January 2023
Deferred Tax relating to Assets and Liabilities arising from a Single Transaction
(Amendments to IAS 12);
1 January 2023
Initial Application of IFRS 17 and IFRS 9 – Comparative Information Amendment to IFRS
17);
1 January 2023
Definition of accounting estimates (Amendments to IAS 8);
1 January 2023
Amendments to IFRS 17 Insurance contracts;
1 January 2023
Amendment to IFRS 16 Leases: Lease Liability in a sale & leaseback*.
1 January 2024
* Subject to EU endorsement
(d) Basis of consolidation
Subsidiaries are entities controlled by the Company. Control exists when the Company is exposed to, or has rights
to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity. The financial information of subsidiaries is fully consolidated from the date that control
commences until the date that control ceases.
Intragroup balances, and any gains and losses or income and expenses arising from intragroup transactions, are
eliminated in preparing the consolidated financial information.
(e) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.
The Group initially recognises financial assets and financial liabilities at fair value. With the exception of
warrants, financial assets and liabilities are subsequently remeasured at amortised cost using the effective
interest rate.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
22
2. ACCOUNTING POLICIES (CONTINUED)
Warrants
Warrants are accounted for as derivative liability instruments under IAS 32 and are measured at fair value at the
date of issue and remeasured at each subsequent reporting date with changes in fair value being recognised in
the Statement of Comprehensive Income. Fair value of the warrants has been calculated using a Black-Scholes
option pricing methodology and details of the estimates and judgements used in determining the fair value of
the warrants are set out in Note 3. The warrant liability will be derecognised when the liability is extinguished
either through exercise or expiry.
(f) Cash and cash equivalents
Cash and cash equivalents comprise cash balances at banks.
(g) Equity
Ordinary shares, A shares and sponsor shares are classified as equity
. Incremental costs directly attributable to
the issue of new shares are recognised in equity as a deduction from the proceeds.
(h) Corporation tax
Corporation tax for the year presented comprises current and deferred tax.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantially enacted at the balance sheet date. Deferred tax is provided using the balance sheet liability method,
providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. A deferred tax asset is recognised only to the extent that
it is probable that future taxable profits will be available against which the asset can be utilised.
(i) Loss per ordinary share
The Group presents basic earnings per ordinary share (“EPS”) data for its ordinary shares and A shares as
disclosed in more detail in Note 8. Basic EPS is calculated by dividing the profit or loss attributable to ordinary
shareholders of the Company by the weighted average number of ordinary shares outstanding during the year.
Diluted EPS is calculated by adjusting the weighted average number of ordinary shares outstanding to assume
conversion of all potential dilutive ordinary shares.
(j) Share based payments
The A1 ordinary shares and A2 ordinary shares in MAC II (BVI) Limited (the "Incentive Shares''), represent equity-
settled share-based payment arrangements under which the Group receives services as a consideration for the
additional rights attached to these equity shares.
Equity-settled share-based payments to Directors and others providing similar services are measured at the fair
value of the equity instruments at the grant date. Fair value is determined using an appropriate valuation
technique, further details of which are given in Note 17. The fair value is expensed, with a corresponding increase
in equity, on a straight-line basis from the grant date to the expected exercise date. Where the equity
instruments granted are considered to vest immediately as the services are deemed to have been received in
full, the fair value is recognised as an expense with a corresponding increase in equity recognised at grant date.
(k) Warrants
On 4 December 2020, the Company issued 700,000 ordinary shares and matching warrants. Under the terms of
the warrant instrument, warrant holders are able to acquire one ordinary share per warrant at a price of £1 per
ordinary share, subject to a downward price adjustment depending on the price of future shares issued prior to
or in conjunction with an initial acquisition.
On 20 April 2021, the Company issued 12,000,000 A shares and matching A warrants at a price of £1 for one
ordinary A share and matching A warrant. Under the terms of the warrant instrument, warrant holders are able
to acquire one ordinary share per warrant at a price of £1 per ordinary share, subject to a downward price
adjustment depending on the price of future shares issued prior to or in conjunction with an initial acquisition.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23
2.’’’’ACCOUNTING POLICIES (CONTINUED)
Warrants are accounted for as derivative liability instruments under IAS 32 and are measured at fair value at the
date of issue and each subsequent balance sheet date. Fair value of the warrants has been calculated using a
Black-Scholes option pricing methodology and details of the estimates and judgements used in determining the
fair value of the warrants are set out in Note 3.
3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
The preparation of the Group’s Financial Statements under IFRS requires the Directors to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets
and liabilities. Estimates and judgements are continually evaluated and are based on historical experience and
other factors including expectations of future events that are believed to be reasonable under the circumstances.
Actual results may differ from these estimates.
Key sources of estimation uncertainty
Valuation of warrants
The Company has issued matching warrants for both its issues of ordinary shares and A shares. For every share
subscribed for, each investor was also granted a warrant ("Warrant") to acquire a further share at an exercise
price of £1.00 per share (subject to a downward adjustment under certain conditions). In the prior period, the
Warrants were exercisable at any time until five years after the issue date; effective 31 March 2022, the exercise
date for the Warrants was extended to the 5
th
anniversary of a Business Acquisition, as detailed in Note 13. The
Warrants are valued using the Black-Scholes option pricing methodology which considers the exercise price,
expected volatility, risk free rate, expected dividends, and expected term of the Warrants.
Valuation of Incentive Scheme
The Company has issued Incentive Shares as part of the creation of a long-term incentive scheme which is valued
using a Monte Carlo model. This model requires estimation and judgment surrounding the inputs of exercise
price, expected volatility, risk free rate, expected dividends, and expected term of the Incentive Shares. The
Ordinary A share liability held represents the subscription price of shareholders where there is an option to
redeem the shares for cash should a shareholder be classified as a good leaver (refer to Note 17). Any
redemption for cash in this scenario would be made at the lower of market value and the subscription price. The
Directors estimate the subscription price to be materially equivalent to their underlying market value.
Other disclosures relating to the Group’s exposure to risk and uncertainties are included in Note 16.
Critical accounting judgements
Classification of warrants
The Directors consider the warrants to represent a derivative liability due to the potential modification of the
exercise price under certain conditions that the Directors believe are possible to occur. This modification results
in the warrants failing the ‘fixed for fixed’ test, as outlined in IAS 32 para 16, which is required to recognise the
warrants as equity instruments. This test requires the Company to provide a fixed number of shares for a fixed
amount of cash on exercise of the warrants which would not be the case should the exercise price be modified.
Accordingly, the warrants are recognised as derivative liabilities, whereby the fair value must be assessed at each
balance sheet date with a review of the underlying inputs undertaken.
The initial fair value recognised for the warrants affects the corresponding entry in equity recognised for the
issue of shares as the proceeds are required to be allocated between equity and liability as one share and
matching warrant was issued for £1 in aggregate and therefore the proceeds received from the issue of equity
is deemed to have been received for both the issue of the shares and the corresponding warrants.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24
3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (CONTINUED)
Recognition and classification of costs relating to a possible further equity raise
In connection with a potential acquisition, the Company has continued to actively consider a possible further
equity raise and on 29 March 2022, the Company announced that it was launching the Placing Programme. In
relation to this, £723,592 (2021: £592,827) of costs incurred have been included in current asset deferred costs
(refer to Note 10) The Directors have considered each of these costs to determine whether:
(i) they are directly attributable to the issuance of shares, and therefore would be taken as a
deduction from equity on the issuance of further equity, or;
(ii) they should be taken directly to the Statement of Comprehensive Income as expenses.
At the year end, these costs are considered to be directly attributable to a future issuance of shares which the
Directors intend to conclude within the next 12 months, at which point these costs would be subsequently
reclassified from deferred costs to equity. However, there is no certainty that this capital raise will take place. If
this further equity raise is not concluded, these costs will be expensed to the Statement of Comprehensive
Income.
4. SEGMENT INFORMATION
The Board of Directors is the Group’s chief operating decision-maker. As the Group has not yet acquired an
operating business, the Board of Directors considers the Group as a whole for the purposes of assessing
performance and allocating resources, and therefore the Group has one reportable operating segment.
5. EMPLOYEES AND DIRECTORS
The Group does not have any employees other than the Board of Directors. During the year ended 30 June 2022,
the Company had three Directors: James Corsellis, Mark Brangstrup Watts and Mark Hodges. Mark Hodges was
the only Director to receive remuneration under the terms of his director service agreement. The Company’s
subsidiary has issued Incentive Shares directly to Mark Hodges during the year ended 30 June 2022, he is
currently the only Director to hold shares directly, the other Directors are beneficially interested through their
indirect interest in Marwyn Long Term Incentive LP. Further detail is disclosed in Note 17.
(a) Employment costs for the Group during the year:
On the 19 June 2022, Mark Hodges was appointed as a Non-Executive Director and Chairman. Under the terms
of his appointment letter, he is entitled to an annual fee of £250,000 and received a signing on fee of £61,238 of
which £47,000 was used to pay the subscription for his Incentive Shares as further detailed in Note 17.
For the year
ended 30 June
202
2
For the period
ended 30 June
2021
£’s
£’s
Wages and salaries
8,333
-
Social security costs
10,356
-
Signing on fee
61,238
-
Total employment costs expense
79,927
-
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
25
5. EMPLOYEES AND DIRECTORS (CONTINUED)
(b) Key management compensation
The Board considers the Directors of the Company to be the key management personnel of the Group.
(c) Employed persons
The average monthly number of persons employed by the Group (including Directors) during the year was as
follows:
6. ADMINISTRATIVE EXPENSES
For the
year
ended 30 June
2022
For the period
Ended 30 June
2021
£’s
£’s
Group expenses by nature
Personnel costs
79,927
-
Non-recurring project, professional and diligence costs
793,214
263,769
Professional support
410,298
178,347
Audit fees payable (Note 20)
20,000
35,000
Share-based payment expenses (Note 17)
1,169
154,960
Sundry expenses
9,393
4,024
1,314,001
636,100
For the year
ended 30 June
2022
For the period
ended 30 June
2021
number
number
Directors
2
2
2
2
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
26
7. INCOME TAX
For the year
ended 30 June
2022
For the period
Ended 30 June
2021
£’s
£’s
Analysis of tax in year
Current tax on loss for the year
-
-
Total current tax
-
-
Reconciliation of effective rate and tax
charge
For the year
ended 30 June
2022
For the period
Ended 30 June
2021
£’s
£’s
Loss on ordinary activities before tax
(1,934,518)
(636,096)
Loss multiplied by the rate of corporation tax in the UK of 19%
(2021: 19%)
(367,558)
(120,859)
Effects of:
Other disallowable expenditure
131,780
29,973
Tax losses not utilised
235,778
90,886
Total taxation charge
-
-
The Group is tax resident in the UK. As at 30 June 2022, cumulative tax losses available to carry forward against
future trading profits were £1,719,280, (2021: £478,343) subject to agreement with HM Revenue & Customs.
There is currently no certainty as to future profits and no deferred tax asset is recognised in relation to these
carried forward losses. Under UK Law, there is no expiry for the use of tax losses.
8. LOSS PER ORDINARY SHARE
Basic EPS is calculated by dividing the loss attributable to equity holders of the company by the weighted average
number of ordinary shares and A shares in issue during the year.
Diluted EPS is calculated by adjusting the
weighted average number of ordinary shares and A shares outstanding to assume conversion of all dilutive
potential ordinary shares and A shares. The Company being loss making in both this year and comparative period
means that any exercise would be anti-dilutive.
The Company maintains different share classes, of which ordinary shares, A shares and sponsor shares were in
issue in the current year and prior period. The key difference between ordinary shares and A shares is that the
ordinary shares are traded with voting rights attached. The ordinary share and A share classes both have equal
rights to the residual net assets of the Company, which enables them to be considered collectively as one class
per the provisions of IAS 33. The sponsor share has no rights to distribution rights so has been ignored for the
purposes of IAS 33. There were no B shares or C shares in issue in either the current year or prior period.
Refer to Note 13 (warrant liability) and Note 17 (share based payments) for instruments that could potentially
dilute basic EPS in the future.
For the year
ended 30 June
2022
For the period
ended 30 June
2021
Loss attributable to owners of the parent (£’s)
(1,934,518)
(636,096)
Weighted average in issue
12,700,000
2,986,827
Basic and diluted loss per ordinary share (£’s)
(0.1523)
(0.2130)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27
9. SUBSIDIARY
Marwyn Acquisition Company II Limited is the parent company of the Group, the Group comprises of Marwyn
Acquisition Company II Limited and the following subsidiary as at 30 June 2022:
Company name Nature of business
Country of
incorporation
Proportion of
ordinary shares held
directly by parent
MAC II (BVI) Limited
Incentive vehicle
British Virgin Islands
100%
The share capital of MAC II (BVI) Limited consists of both ordinary shares and Incentive Shares. The Incentive
Shares are non-voting and disclosed in more detail in Note 17.
There are no restrictions on the parent company’s ability to access or use the assets and settle the liabilities of
the parent company’s subsidiary The registered office of MAC II (BVI) Limited is Commerce House, Wickhams
Cay 1, P.O. Box 3140, Road Town, Tortola, VG1110, British Virgin Islands.
10. OTHER RECEIVABLES
As at
30 June
202
2
As at
30 June
2021
£’s
£’s
Amounts receivable within one year:
Prepayments
17,634
4.658
Deferred costs
723,592
592,827
Due from related party (Note 18)
42,001
23,964
VAT receivable
22,133
30,259
805,360
651,708
There is no material difference between the book value and the fair value of the receivables. Receivables are
considered to be past due once they have passed their contracted due date. Other receivables are all current.
11. CASH AND CASH EQUIVALENTS
As at
30 June
2022
As at
30 June
2021
£’s
£’s
Cash and cash equivalents
Cash at bank
10,254,198
12,255,387
10,254,198
12,255,387
Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents and deposits with banks
and financial institutions. For banks and financial institutions, only independently rated parties with a minimum
short-term credit rating of P-1, as issued by Moody’s, are accepted.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28
12. TRADE AND OTHER PAYABLES
As at
30 June
2022
As at
30 June
2021
£’s
£’s
Amounts falling due within one year:
Trade payables
74,740
88,870
Due to a related party (Note 18)
109,735
41,355
Accruals
141,026
818,305
Other tax liabilities
26,841
-
A1 ordinary share liability (Note 17)
47,000
-
399,342
948,530
There is no material difference between the book value and the fair value of the trade and other payables.
All trade payables are non-interest bearing and are usually paid within 30 days.
13. WARRANT LIABLITY
£’s
Fair value of warrants:
At incorporation
-
Fair value of warrant issuances:
Warrant liability - ordinary warrants
98,000
Warrant liability – A warrants
1,680,000
Fair value of warrants at 30 June 2021
1,778,000
Fair value movement of warrants:
Warrant liability - ordinary warrants
35,000
Warrant liability – A warrants
600,000
Total fair value movement
635,000
Fair value of warrants at 30 June 2022
2,413,000
On 4 December 2020, the Company issued 700,000 ordinary shares and matching warrants at a price of £1 for
one ordinary share and matching warrant. Under the terms of the warrant instrument (“Warrant Instrument”),
warrant holders are able to acquire one ordinary share per warrant at a price of £1 per ordinary share, subject
to a downward price adjustment depending on the price of future shares issued prior to or in conjunction with
an initial acquisition. Warrants are fully vested at the year end.
On 20 April 2021, the Company issued 12,000,000 A shares and matching warrants at a price of £1 for one A
share and matching A warrant. Under the terms of the A warrant instrument (“A Warrant Instrument”), warrant
holders are able to acquire one ordinary share per warrant at a price of £1 per ordinary share, subject to a
downward price adjustment depending on the price of future shares issued prior to or in conjunction with an
initial acquisition.. Warrants are fully vested at the year end.
Effective 31 March 2022, both the Warrant Instrument and A Warrant Instrument were amended such that the
long stop date was extended to the fifth anniversary of an initial acquisition by a member of the Group (which
may be in the form of a merger, share exchange, asset acquisition, share or debt purchase, reorganisation or
similar transaction) of a business (“Business Acquisition”). Previously the warrants were exercisable for 5 years
from the date of issue.
Warrants are accounted for as a level 3 derivative liability instruments and are measured at fair value at grant
date and each subsequent balance sheet date. The warrants and A warrants were separately valued at the date
of grant. For both the warrants and A warrants, the combined market value of one share and one Warrant was
considered to be £1, in line with the price paid by investors. A Black-Scholes option pricing methodology was
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
29
13.’’WARRANT LIABLITY (CONTINUED)
used to determine the fair value, which considered the exercise prices, expected volatility, risk free rate,
expected dividends and expected term. On initial recognition, Warrants had a fair value of 14p per Warrant. This
remained unchanged until 30 June 2022 (the balance sheet date) where the fair value increased to 19p per
Warrant. The Directors are responsible for determining the fair value of the warrants at each reporting date, the
underlying calculations are prepared by Deloitte LLP.
The key assumptions used in determining the fair value of the Warrants are as follows:
As at
3
0 June
2022
As at
30 June
2021
Combined price of a share and warrant
£1
£1
Exercise price
£1
£1
Expected volatility
30.0%
25.0%
Risk free rate
2.17%
0.32%
Expected dividends
0.0%
0.0%
Expected term
5th anniversary of
the
completion of a
Business
Acquisition
5 years from the
IPO
and 4.4 years
from the period
end date
14. STATED CAPITAL
As at
30 June
2022
As at
30 June
2021
Issued and fully paid
£’s
£’s
700,000 ordinary shares of no par value
326,700
326,700
12,000,000 A shares of no par value
10,320,000
10,320,000
1 sponsor share of no par value
1
1
Total
10,646,701
10,646,701
On incorporation, the Company issued 1 ordinary share of no par value to MVI II Holdings I LP. On 30 September
2020, it was resolved that updated memorandum and articles ("Updated M&A") be adopted by the Company
and with effect from the time the Updated M&A be registered with the Registrar of Corporate Affairs in the
British Virgin Islands, the 1 ordinary share which was in issue by the Company be redesignated as 1 sponsor share
of no par value (the "Sponsor Share").
On 4 December 2020, the Company issued 700,000 ordinary shares and matching warrants at a price of £1 for
one ordinary share and matching warrant. As a result of the fair value exercise of the warrants, 14p was
attributed to the warrants and therefore each ordinary share was initially valued at 86p per share. Costs of
£275,300 directly attributable to this equity raise were taken against stated capital during the period ended 30
June 2021.
On 20 April 2021, the Company issued 12,000,000 A shares and matching A warrants at a price of £1 for one A
share and matching A warrant. As a result of the fair value exercise of the A warrants, 14p was attributed to the
A warrants and therefore each ordinary share was initially valued at 86p per share. There were no costs directly
attributable to the issue of these shares.
There has been no issue of any share capital in the year ended 30 June 2022.
The ordinary shares and A shares are entitled to receive a share in any distribution paid by the Company and a
right to a share in the distribution of the surplus assets of the Company on a winding-up. Only ordinary shares
have voting rights attached. The Sponsor Share confers upon the holder no right to receive notice and attend
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
30
14. STATED CAPITAL (CONTINUED)
and vote at any meeting of members, no right to any distribution paid by the Company and no right to a share
in the distribution of the surplus assets of the Company on a summary winding-up. Provided the holder of the
Sponsor Share holds directly or indirectly 5 per cent. or more of the issued and outstanding shares of the
Company (of whatever class other than any Sponsor Shares), they have the right to appoint one director to the
Board.
The Company must receive the prior consent of the holder of the Sponsor Share, where the holder of the Sponsor
Share holds directly or indirectly 5 per cent. or more of the issued and outstanding shares of the Company, in
order to:
• Issue any further Sponsor Shares;
• issue any class of shares on a non pre-emptive basis where the Company would be required to issue
such share pre-emptively if it were incorporated under the UK Companies Act 2006 and acting in
accordance with the Pre-Emption Group's Statement of Principles; or
• amend, alter or repeal any existing, or introduce any new share-based compensation or incentive
scheme in respect of the Group; and
• take any action that would not be permitted (or would only be permitted after an affirmative
shareholder vote) if the Company were admitted to the Premium Segment of the Official List.
The Sponsor Share also confers upon the holder the right to require that: (i) any purchase of ordinary shares; or
(ii) the Company's ability to amend the Memorandum and Articles, be subject to a special resolution of members
whilst the Sponsor (or an individual holder of a Sponsor Share) holds directly or indirectly 5 per cent. or more of
the issued and outstanding shares of the Company (of whatever class other than any Sponsor Shares) or are a
holder of incentive shares.
15. RESERVES
The following describes the nature and purpose of each reserve within shareholders’ equity:
Accumulated losses
Cumulative losses recognised in the Consolidated Statement of Comprehensive Income.
Share based payment reserve
The share based payment reserve is the cumulative amount recognised in relation to the equity-settled share
based payment scheme as further described in Note 17.
16. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS
The fair value measurement of the Group’s financial and non-financial assets and liabilities utilities market
observable inputs and data as far as possible. Inputs used in determining fair value measurements are
categorised into different levels based on how observable the inputs used in the valuation technique utilised are
(the “fair value hierarchy”):
Level 1: Quoted prices in active markets for identical items;
Level 2: Observable direct or indirect inputs other than Level 1 inputs; and
Level 3: Unobservable inputs, thus not derived from market data.
The classification of an item into the above levels is based on the lowest level of the inputs used that has a
significant effect on the fair value measurement of the item. Transfers of items between levels are recognised in
the year they occur.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31
16.’’FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)
The Group has the following categories of financial instruments as at 30 June 2022:
As at
30 June
2022
As at
30 June
2021
£’s
£’s
Financial assets measured at amortised cost
Cash and cash equivalents (Note 11)
10,254,198
12,255,387
Due from related party (Note 18)
42,001
23,964
10,296,199
12,279,351
Financial liabilities measured at amortised cost
Trade Creditors
74,740
88,870
Due to related party (Note 18)
109,735
41,355
Accruals
141,026
818,305
A1 ordinary share liability
47,000
-
372,501
948,530
Financial liabilities measured at FVPL
Warrant Liability (Note 13)
2,413,000
1,778,000
2,413,000
1,778,000
All financial instruments are classified as current assets and current liabilities. There are no non-current financial
instruments as at 30 June 2022.
For details of valuation techniques and significant unobservable inputs related to determining the fair value of
the warrant liability, which is classified in level 3 of the fair value hierarchy, refer to Note 13.
The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to
set appropriate risk limits and controls, and to monitor risks and adherence limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. Treasury
activities are managed on a Group basis under policies and procedures approved and monitored by the Board.
As the Group’s assets are predominantly cash and cash equivalents, market risk, and liquidity risk are not
currently considered to be material risks to the Group. The Directors have reviewed the risk of holding a singular
concentration of assets as predominantly all credit assets held are cash and cash equivalents, however, do not
deem this a material risk. The risk is mitigated by all cash and cash equivalents being held with Barclays Bank plc,
which holds a short-term credit rating of P-1, as issued by Moody’s.
17. SHARE-BASED PAYMENTS
Management Long Term Incentive Arrangements
The Group has put in place a Long-Term Incentive Plan ("LTIP"), to ensure alignment between Shareholders, and
those responsible for delivering the Company’s strategy and attract and retain the best executive management
talent.
The LTIP will only reward the participants if shareholder value is created. This ensures alignment of the interests
of management directly with those of Shareholders.
On inception of the LTIP, Incentive Shares were issued by the Company’s subsidiary to Marwyn Long Term
Incentive LP ("MLTI"). On 17 June 2022, the Incentive Shares in the Company’s subsidiary were redesignated into
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
32
17. SHARE-BASED PAYMENTS (CONTINUED)
A1 ordinary shares (“A1 Shares”) and A2 ordinary shares (“A2 Shares”). Effective 19 June 2022, the Incentive
shares issued to MLTI were redesignated as A2 Shares and the Company’s Chairman Mark Hodges was issued
2,000 A1 Shares.
Preferred Return
The incentive arrangements are subject to the Company's shareholders achieving a preferred return of at least
7.5 percent per annum on a compounded basis on the capital they have invested from time to time (with
dividends and returns of capital being treated as a reduction in the amount invested at the relevant time) (the
"Preferred Return").
Incentive Value
Subject to a number of provisions detailed below, if the Preferred Return and at least one of the vesting
conditions have been met, the holders of the Incentive Shares can give notice to redeem their Incentive Shares
for ordinary shares in the Company ("Ordinary Shares") for an aggregate value equivalent to 20 per cent. of the
"Growth", where Growth means the excess of the total equity value of the Company and other shareholder
returns over and above its aggregate paid up share capital (20 per cent. of the Growth being the "Incentive
Value").
Grant date
The grant date of the Incentive Shares will be the date that such shares are issued.
Service Conditions and Leaver Provisions
There are leaver provisions in relation to the A1 Shares which are set out in the subscription agreements entered
into between the holders of the A1 Shares and MAC II (BVI) Limited.
If the holder leaves in circumstances in which he or she is deemed to be a “Good Leaver” (being any reason other
than a bad leaver circumstance), then the holder of the A1 Shares will be entitled to the vested portion of the
A1 Shares and in respect of the remainder of the A1 Shares the holder will be required to enter into
documentation under which, at the election of the Company or MAC II (BVI) Limited the remainder of the A1
Shares will be compulsorily redeemed or acquired at the lower of the (i) the subscription price or (ii) the market
value for such A1 Shares or the A1 Shares may be converted into ordinary shares in the Company. Any holder
deemed to be a “Bad Leaver” (such as termination of employment for gross misconduct, fraud or criminal acts)
will be required to sell his A1 Shares back to MAC II (BVI) Limited for a total consideration of £0.01. As there are
conditions whereby the unvested portion of the A1 Shares can be redeemed or acquired at the lower of the (i)
the subscription price or (ii) the market value for such A1 Shares, the amounts received from on the issue of A1
Shares is recognised as a liability in the Financial Statements.
Redemption / Exercise
Unless otherwise determined and subject to the redemption conditions having been met, the Company and the
holders of the Incentive Shares have the right to exchange each Incentive Share for Ordinary Shares in the
Company, which will be dilutive to the interests of the holders of Ordinary Shares. However, if the Company has
sufficient cash resources and the Company so determines, the Incentive Shares may instead be redeemed for
cash. It is currently expected that in the ordinary course Incentive Shares will be exchanged for Ordinary Shares.
However, the Company retains the right but not the obligation to redeem the Incentive Shares for cash instead.
Circumstances where the Company may exercise this right include, but are not limited to, where the Company
is not authorised to issue additional Ordinary Shares or on the winding-up or takeover of the Company.
Any holder of Incentive Shares who exercises their Incentive Shares prior to other holders is entitled to their
proportion of the Incentive Value to the date that they exercise but no more. Their proportion is determined by
the number of Incentive Shares they hold relative to the total number of issued shares of the same class.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
33
17.’’SHARE-BASED PAYMENTS (CONTINUED)
Vesting Conditions and Vesting Period
The Incentive Shares are subject to certain vesting conditions, at least one of which must be (and continue to
be) satisfied in order for a holder of Incentive Shares to exercise its redemption right.
The vesting conditions are as follows:
i. it is later than the third anniversary of the initial Business Acquisition and earlier than the seventh
anniversary of the Business Acquisition;
ii. a sale of all or substantially all of the revenue or net assets of the business of the Subsidiary in
combination with the distribution of the net proceeds of that sale to the Company and then to its
shareholders;
iii. a sale of all of the issued ordinary shares of the Subsidiary or a merger of the Subsidiary in combination
with the distribution of the net proceeds of that sale or merger to the Company's shareholders;
iv. where by corporate action or otherwise, the Company effects an in-specie distribution of all or
substantially all of the assets of the Group to the Company's shareholders;
v. aggregate cash dividends and cash capital returns to the Company's Shareholders are greater than or
equal to aggregate subscription proceeds received by the Company;
vi. a winding-up of the Company;
vii. a winding-up of the Subsidiary; or
viii. a sale, merger or change of control of the Company.
If any of the vesting conditions described in paragraphs (ii) to (viii) above are satisfied before the third
anniversary of the initial Business Acquisition, the Incentive Shares will be treated as having vested in full.
Holding of Incentive Shares
MLTI and Mark Hodges hold Incentive Shares entitling them to aggregate to 100 per cent. of the Incentive Value.
Any future management partners or senior executive management team members receiving Incentive Shares
will be dilutive to the interests of existing holders of Incentive Shares, however the share of the Growth of the
Incentive Shares in aggregate will not increase.
The following shares were in issue at 30 June 2022:
Issue date Name
Share
designation
at balance
sheet date
Nominal
Price
Issue
price per
A
ordinary
share
£’s
Number
of A
ordinary
shares
Unrestricted
market
value at
grant date
£’s
IFRS 2
Fair value
£’s
25 November 2020
MLTI
A2
£0.01
7.50
2,000
15,000
169,960
19 June 2022
Mark
Hodges
A1 £0.01 23.50 2,000 47,000 166,275
Valuation of Incentive Shares
Valuations were performed by Deloitte LLP using a Monte Carlo model to ascertain the unrestricted market value
and the fair value at grant date. Details of the valuation methodology and estimates and judgements used in
determining the fair value are noted herewith and were in accordance with IFRS 2 at grant date.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
34
17.’’SHARE-BASED PAYMENTS (CONTINUED)
There are significant estimates and assumptions used in the valuation of the Incentive Shares. Management has
considered at the grant date, the probability of a successful first Business Acquisition by the Company and the
potential range of value for the Incentive Shares, based on the circumstances on the grant date.
The fair value of the Incentive Shares granted under the scheme was calculated using a Monte Carlo model with
the following inputs:
Issue date Name
Share
designation at
balance sheet
date
Volatility Risk-free rate
Expected term*
(years)
25 November 2020
MLTI
A2
25%
0.0%
7.0
19 June 2022
Mark Hodges
A1
30%
2.2%
7.1
*The expected term assumes that the Incentive Shares are exercised 7 years post acquisition.
The Incentive Shares are subject to the Preferred Return being achieved, which is a market performance
condition, and as such has been taken into consideration in determining their fair value. The model incorporates
a range of probabilities for the likelihood of an Business Acquisition being made of a given size.
Expense related to Incentive Shares
An expense of £1,169 (2021: £154,960) has been recognised in the Statement of Comprehensive Income in
respect of the Incentive Shares issued during the year. There is a service condition associated with the shares
issued to Mark Hodges, which requires the fair value charge associated with his shares to be allocated over the
minimum vesting period. This vesting period is estimated to be 3.1 years from the date of grant.
There are no service conditions attached to the MLTI shares and as result the fair value at grant date was
expensed to the profit and loss account on issue.
18. RELATED PARTY TRANSACTIONS
James Corsellis and Mark Brangstrup Watts are directors of the Company and Antoinette Vanderpuije is the
Company Secretary of the Company. Funds managed by MIM LLP of which James Corsellis and Mark Brangstrup
Watts are managing partners and Antoinette Vanderpuije is a partner, hold 75 per cent. of the Company's issued
ordinary shares and warrants and 100% of the A shares and A warrants at the balance sheet date. During the
year MIM LLP recharged expenses of £46,583 (2021: £11,805), of which £nil was outstanding at the year end
(2021: £nil).
James Corsellis, Mark Brangstrup Watts and Antoinette Vanderpuije have an indirect beneficial interest in the
Incentive Shares as described in Note 17 of the Financial Statements through their indirect interest in MLTI which
owns 2,000 A2 Shares in the capital of MAC II (BVI) Limited.
James Corsellis and Mark Brangstrup Watts are the managing partners of Marwyn Capital LLP, and Antoinette
Vanderpuije is also a partner. Marwyn Capital LLP provides corporate finance and managed services support,
including named company secretary, to the Company. As part of this engagement a fee of £150,000 was charged
in relation to the Company’s equity raise on IPO, this fee was recognised and invoiced in the period ended 30
June 2021. On an ongoing basis a monthly fee of £10,000 per calendar month was charged for the provision of
the corporate finance services, with such monthly fee increased to £25,000 effective 31 March 2022 on launch
of the Placing Programme and £50,000 per calendar month from 19 June, being the date of Mark Hodge’s
appointment. As part of the Placing Programme a one-off fee of £325,000 was charged in respect of the services
provided. Managed services support is charged by Marwyn Capital LLP on a time spent basis. The total amount
charged in the year ended 30 June 2022 by Marwyn Capital LLP for fees was £553,641 (period ended 30 June
2021: £232,400) and they had incurred expenses on behalf of the Group, which were subsequently recharged of
£299,434 (period ended 30 June 2021: £7,395). An amount payable to Marwyn Capital LLP of £97,575 (2021:
£41,355) was outstanding as at the year end.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
35
18. ’RELATED PARTY TRANSACTIONS (CONTINUED)
The Company has recharged costs associated with provision of project services of £16,039 (2021: £23,964)
inclusive of VAT to Marwyn Acquisition Company III Limited (“MAC III”), of which £nil (2021: £23,964) was due
to the Company at year end. MAC III is related to the Group through James Corsellis and Mark Brangstrup Watts
being directors of MAC III.
The Company has recharged costs associated with provision of project services of £42,000 (2021: £nil) inclusive
of VAT to MAC III (BVI) Limited (“MAC III (BVI)”), of which £42,000 (2021: £nil) was due to the Company at year
end. MAC III (BVI) is related to the Group through James Corsellis and Mark Brangstrup Watts being directors of
MAC III (BVI).
Mark Hodge’s director compensation is disclosed in Note 5 and his holdings of Incentive Shares is disclosed in
Note 17.
19. COMMITMENTS AND CONTINGENT LIABILITIES
There were no commitments or contingent liabilities outstanding at 30 June 2022 which would require disclosure
or adjustment in these Financial Statements (30 June 2021: £Nil).
20. INDEPENDENT AUDITOR’S REMUNERATION
On 24 August 2022, the Group appointed Baker Tilly Channel Islands Limited as the Group’s independent auditor,
replacing Mazars LLP. Audit fees payable for the year ended 30 June 2022 are £20,000 (2021: £35,000 paid to
Mazars LLP). Fees payable for the year ended 30 June 2022 in respect of any non-audit related procedures are
£Nil (2021: £17,500 paid to Mazars LLP).
21. POST BALANCE SHEET EVENTS
There have been no material post balance sheet events that would require disclosure or adjustment in these
Financial Statements (2021: None).
ADVISERS
36
Financial Adviser
BVI legal advisers to the Company
Investec Bank Plc
Conyers Dill & Pearman
30 Gresham St
Commerce House
London
Wickhams Cay 1
EC2V 7QN
Road Town
+44 (0)20 7597 4000
VG1110
Financial Adviser
Tortola
British Virgin Islands
Financial Adviser
Depository
N.M. Rothschild & Sons Limited
Link Market Services Trustees Limited
New Court, St Swithin's Lane
The Registry
London
34 Beckenham Road
EC4N 8AL
Beckenham
+44 (0)20 7280 5000
Kent
BR3 4TU
Company Broker
Registrar
WH Ireland Limited
Link Market Services (Guernsey) Limited
24 Martin Lane
Mont Crevelt House
London
Bulwer Avenue
EC4R 0DR
St Sampson
+44 (0)20 7220 1666
Guernsey
Company Broker
GY2 4LH
Company Secretary
Independent auditor
Antoinette Vanderpuije
For the year ended 30 June 2022
11 Buckingham Street
Baker Tilly Channel Islands Limited
London
First Floor, Kensington Chambers
WC2N 6DF
46-50 Kensington Place
Email: MAC2@marwyn.com
St Helier
Jersey, JE4 0ZE
Registered Agent and Assistant Company Secretary
For the period ended 30 June 2021
Conyers Corporate Services (BVI) Limited
Mazars LLP
Commerce House
Tower Bridge House
Wickhams Cay 1
St. Katharine’s Way
Road Town
London
VG1110
E1W 1DD
Tortola
British Virgin Islands
Registered office
Commerce House
English legal advisers to the Company
Wickhams Cay 1
Travers Smith LLP
Road Town
10 Snow Hill
VG1110
London
Tortola
EC1A 2AL
British Virgin Islands