DroneShield to raise $120 million at $1.15 a share
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More news: DroneShield is looking to raise $120 million at $1.15 a share, according to the term sheet sighted by Capital Brief. This is a 17.3% discount to the last close and a 35.1% discount to its 15-day volume-weighted average price.
The round will see approximately 104.3 million new shares being issued, bringing its fully diluted enterprise value to just $795.5 million.
Bell Potter, Shaw and Partners, and Macquarie are acting as joint managers on the placement to sophisticated and professional investors.The book is expected to close at 5pm AEST on Wednesday with shares expected to begin trading again on Friday and new shares to be issued the following Friday.
Of the total raise, $90 million will be used to develop DroneShield's technology, $20 million is for strategic bolt-on acquisitions with a further $10 million designated as working capital.
Once concluded, the raise would take the company's cash balance to $266 million. Of that, $45 million is already committed to increase inventory with another $50 million expected to be spent on top. Some $51 million is also earmarked for research and development programs, additional inventory requirements and as working capital.
A presentation call with CEO Oleg Vornik and CTO Angus Bean is scheduled for 12pm.
What they said: "DRO is undertaking this offer to support the implementation and extension of its R&D programs," the company said on the deal sheet.
"Extending R&D into new products and new generations of existing products will: entrench DRO's position as the market leader in the rapidly expanding C-UxS market; enable DRO to expand into new markets and products as the drone and counterdrone warfare evolves; expand gross profit margins as the revenue mix shifts toward AI enabled software; solutions supported by DRO’s market leading hardware solutions; [and] accelerate SaaS revenues."
DroneShield halts trading for another capital raise
The news: DroneShield has entered a trading halt as the defence tech company flagged another capital raising. Details are expected to be issued to the market shortly.
The numbers: DroneShield had $146 million cash at the end of June and no debt, according to its latest quarterly report. The company has told shareholders that a "substantial majority" of that cash has been earmarked to build inventory.
In April, DroneShield raised $100 million in an oversized placement.
Shares last traded at $1.39 and over the past 12 months has rocketed 348.4%.
The context: The company has talked up its future pipeline of work, doubled to $1.1 billion since the March quarter and noting a "significant ramp up" in the Asia Pacific. In contrast, its contracted backlog sits at just $28 million.
It has also signed a lease to add an additional 1,800 square metres to its existing Sydney headquarters and hired more engineers as it expects demand for anti-drone technology to pick up.
The company has drawn significant retail investor interest as its market cap swelled to almost $2 billion before halving in recent weeks. CEO Oleg Vornik has defended its multiple as being reflective of its growth trajectory.
The source: ASX announcement
