Drone detection and countermeasure business DroneShield has announced firm commitments for $10.9 million in a placement, and that it is undertaking a share purchase plan for current investors to raise a further $3 million.
Shares in each case were issued at 30 cents each, a discount of 18.9 per cent on the price at the close of trading on Wednesday February 1.
DroneShield said on Monday that net proceeds would support an increase of inventory on hand for rapid fulfilment of larger contracts; investing in the company’s engineering, manufacturing and sales teams; and general working capital.
According to the company, the $10.9 million placement saw strong support from more than ten Australian and international institutional investors. Peloton Capital and Bell Potter Securities acted as joint lead managers for the placement.
“This capital raise enables DroneShield to take full advantage of opportunities for rapid growth, following our two record $11 million sales announced in December 2022 and January 2023, as the market demand for counterdrone equipment is rapidly heating up around the world,” said CEO Oleg Vornik.
“This is underpinned by rising defence and security budgets and an increasing role of drone technology in armed conflicts, terrorism and other nefarious applications. DroneShield welcomes the new domestic and international institutional investors to the company.”
Current shareholders are eligible to purchase up to $30,000 worth of shares under the share purchase plan, with Vornik and chairman Peter James and Vornik to each purchase this maximum amount of $30,000.
The news follows the announcement last month of a greatly improved quarterly result, with December quarter cash receipts up 94 per cent versus the previous corresponding period to $2.6 million.
Shares are scheduled to be issued on February 10 under the placement, and on March 9 under the SPP.
Picture: DroneShield/DroneGun Tactical deployed by the French Army