TIDMAERO
RNS Number : 1567Z
Strat Aero PLC
13 December 2017
Strat Aero plc / Index: AIM / TIDM: AERO / Sector: Support
Services
Strat Aero plc ("Strat Aero", the "Company" or the "Group")
Open Offer to raise up to GBP510,000
Strat Aero plc, an international aerospace company focused on
the rapidly emerging Unmanned Aerial Vehicle ('UAV') sector,
announces that further to the Company's announcement of 5 December
2017 a circular, including an Application Form, will be posted to
Shareholders today (the 'Circular'). A copy of the Circular and
Application Form will be available to view on the Company's website
at www.strat-aero.com.
The total subscription proceeds payable by Shareholders under
the Open Offer shall be less than EUR5 million (or an equivalent
Sterling amount) in aggregate. Therefore, in accordance with
Section 85 and Schedule 11A of FSMA, the Circular is not, and is
not required to be, a prospectus for the purposes of the Prospectus
Rules and has not been prepared in accordance with the Prospectus
Rules. Accordingly, the Circular has not been, and will not be,
reviewed or approved by the Financial Conduct Authority of the
United Kingdom, pursuant to sections 85 and 87 of FSMA, the London
Stock Exchange, any securities commission or any other authority or
regulatory body. In addition, the Circular does not constitute an
admission document drawn up in accordance with the AIM Rules for
Companies.
The definitions that apply throughout this announcement can be
found at the end of the Circular.
1. Introduction
The Company announced on 5 December 2017 that it raised
GBP590,000 (before expenses) through a placing of new Ordinary
Shares at 0.035 pence per share to be used for working capital, to
strengthen the Company's balance sheet and facilitate the
following:
-- Training & Education - continued development of Strat
Aero's Training solutions and delivery capabilities;
-- Survey & Inspection - facilitate the acquisition and
adoption of the latest Unmanned Aerial Systems (UAS) technology;
and
-- Potential strategic investment in complementary businesses
and assets for which several exciting opportunities have been
identified
To provide Shareholders who have not taken part in the Placing
(which was not conditional on the Open Offer) with an opportunity
to participate in the proposed issue of new Ordinary Shares, the
Company is providing all Qualifying Shareholders with the
opportunity to subscribe for an aggregate of up to 1,455,026,120
Open Offer Shares, to raise up to approximately GBP510,000 (before
costs and expenses), on the basis of 20 Open Offer Shares for every
27 Existing Ordinary Shares held on the Record Date, at 0.035 pence
per share. Shareholders subscribing for their full entitlement
under the Open Offer may also request additional Open Offer Shares
through the Excess Application Facility. Investors who participated
in the Placing are not Qualifying Shareholders for the purpose of
the Open Offer and will not be entitled to subscribe for any Open
Offer Shares.
The net proceeds of the Placing together with the net proceeds
of amounts raised from the Open Offer, will be used to strengthen
the Company's balance sheet and facilitate the following:
.
-- Training - continued development of the Strat Aero Training
solutions and delivery capabilities;
-- Geocurve - facilitate the acquisition adoption of the latest
Unmanned Aerial Systems (UAS) technology; and
-- Investment in complementary businesses and assets.
The purpose of the Circular is to provide information on the
Company's current financial and trading position so that
Shareholders may decide whether to subscribe for Open Offer Shares.
Shareholders should also refer to the Company's regulatory
announcements. Open Offer Shares subscribed for will be issued
pursuant to the Company's existing share authorities. Accordingly,
the Open Offer is not subject to Shareholder approval.
Shareholders should consider the Risk Factors set out in Part II
of the Circular in relation to general risks and those specific to
the Open Offer.
Details of the Open Offer are set out below and the steps
required for Qualifying Shareholders to participate in the Open
Offer are set out in Part IV of the Circular.
The Company has raised funds as part of a placing announced on 5
December 2017 to continue implementation of its business plans,
however additional funding raised via the Open Offer will enable
the Company to accelerate attainment of the Company's commercial
priorities.
2. Strategy of the Group
2016 was a year of turbulence at Strat Aero because of the
litigation arising from the acquisition in the US. As a result, the
Board of the Company completed a strategic review of the Company,
which resulted in the replacement of the Group CEO and the
execution of various measures to simplify the business. The
objectives of the strategic review were met by the end on 2016,
resulting in the settlement of the litigation against the Company
and an overall lower cost base.
2017 brought a continued focus in the Company's chosen growth
areas, which has resulted in cost reductions and resource
rationalisation. The Directors believe that the core growth areas
are Geocurve, the Company's survey and inspection business, and the
Strat Aero Training Division. The Company has relevant and class
leading skills and experience in both of these focus areas.
The main areas of focus for the Company are as follows:
1) Training - This is a division led by Mark Wharry, the
Training Director who joined the Company at the end of the first
quarter 2017. He brought significant skills, experience and talent
to the training segment of the business, Mark is one of the leading
UAV Instructors in the world, a professional aviator and flying
instructor and a 20-year fast jet RAF fighter pilot who specialised
in Military UAV training, setting standards procedures for the RAF
and the USAF.2)
2) Survey and Inspection - Geocurve presents a combination of
the following three core areas - UAV Pilots; Surveyors; and Data
Modelling and Analysis. This makes Geocurve unique in the UAV
environment. In addition, Strat Aero is a key innovation partner of
CH2M and have won industry awards in this area as part of that
team. Geocurve has focused on innovation of the survey and
inspection side of the business and has enjoyed a 100% safety
record and the "highest" flying permissions commercially available
from the CAA. In addition to its ability to fly in congested or
difficult environments, Strat Aero has key skills and experience in
survey and inspection along with data modelling, and data
management to provide the Company's customers with tailored data
outputs in useable and manageable formats.
Management's goal is to continue to focus on revenue growth and
to achieve cost optimisation across the Company. It should be noted
our survey business is seasonal in nature as reflected by the main
sectors it serves - namely construction and civil engineering.
Also, our advanced training solutions, whilst launched and seeded
now with key partners in Asia, still requires time for development
and growth in those markets.
3. Use of proceeds
Assuming full take up under the Open Offer, the proceeds of the
Open Offer net of total anticipated expenses, will be approximately
GBP480,000, which will be used for further development of the
Training Division and of Geocurve and to make further investments
in complementary businesses.
The Company intends to apply a proportion of the funds raised to
the Training Division, to purchase software to support courseware
management, delivery and IP protection methods. All of these are
currently planned but require additional investment to bring to
realisation.
The Company also wishes to use some of the funds raised to
invest in new UAV technology. The last 18 months of aggressive cost
management have prevented any investment other than essential
maintenance. New UAV technology is urgently required to exploit new
opportunities in the Survey and Inspection business areas,
including specialised equipment to survey inside sealed structures
such as storage tanks.
In addition, Geocurve also needs workflow management software to
improve, streamline and speed up the process of managing the vast
amounts of data that it processes on behalf of key customers.
The funds will also assist Geocurve to invest in the latest
scanning technology developments. This will be done in response to
an expected additional service contract on flood defence work on
the Thames. The equipment required can be fully utilised in other
industries and can create significant growth opportunities for
Geocurve allowing the Company access to much higher value, long
term contracts with established customers.
The Company will also look to acquire interests in complementary
innovative and disruptive technology focused businesses. The Board
has a considerable number of contacts with attractive opportunities
within these areas and would like to use the Company as a platform
to identify and exploit these opportunities to maximise value for
Shareholders. The Directors have considerable experience in
managing technology enabled businesses in a global environment and
believe that they can identify investment targets which will be
complementary to the Company's current business.
The Board believes that the proposed fundraising will augment
the resources from our recent placing to ensure sufficient support
is available to meet the modest working capital requirements of the
Strat Aero group and provide the much-needed boost from appropriate
investment to underpin the company's chosen strategy. The
Directors' believe that this will ultimately deliver consistent
profitable growth by bringing innovation and technology to, the
typically manual and labour intensive, industrial sectors that the
Company serves.
With Strat Aero in a strong position, the Company intends
building on its existing expertise to pursue a strategy of
identifying and acquiring interests in companies in a similar
position to Strat Aero, specifically companies with products and or
services and intellectual property in the disruptive technology
space. Typically, these companies will benefit from the experience
and skills of the Strat Aero management, strengthening their
strategic focus, and facilitating profitable growth.
4. Details of the Placing
On 5 December 2017, the Company announced that it had
conditionally placed 1,685,714,286 Placing Shares at 0.035 pence
(the Issue Price) to raise GBP590,000 (before expenses). The
Placing completed on 8 December 2017 and the Placing Shares were
admitted to trading on AIM on that date.
1,011,428,571 Warrants with a six month expiry and an exercise
price of 0.035 pence were also issued in conjunction with the
Placing.
5. Details of the Open Offer
The Company is proposing to raise up to GBP510,000 (before
expenses) pursuant to the Open Offer. The proposed issue price of
0.035 pence per Open Offer Share is the same price as the Issue
Price at which Placing Shares were issued pursuant to the
Placing.
The Directors recognise the importance of pre-emption rights to
Shareholders and consequently up to 1,455,026,120 Open Offer Shares
are being offered to existing Shareholders by way of the Open
Offer. The Open Offer provides Qualifying Shareholders with an
opportunity to participate in the Open Offer by subscribing for
their respective Basic Entitlements and Excess Entitlements.
Qualifying Shareholders may subscribe for Open Offer Shares in
proportion to their holding of Existing Ordinary Shares held on the
Record Date. Shareholders subscribing for their full entitlement
under the Open Offer may also request additional Open Offer Shares
as an Excess Entitlement, up to the total number of Open Offer
Shares available to Qualifying Shareholders under the Open
Offer.
The Open Offer is conditional, amongst other things, on the
following:
i. admission of the Open Offer Shares to trading on AIM becoming
effective on or before 8.00 a.m. on 5 January 2018 (or such later
date and/or time as the Company and Peterhouse may agree, being no
later than 12 January 2018).
In the event that the Open Offer does not become unconditional
by 11.00 a.m. on 29 December 2017, the Open Offer will lapse and
application monies will be returned by post to the Applicant(s) at
the Applicant's risk and without interest, to the address set out
in the Application Form, within 14 days thereafter.
The Open Offer Shares will, when issued and fully paid, rank
pari passu in all respects with the Ordinary Shares, including the
right to receive all dividends and other distributions declared,
made or paid after the date of Admission.
Basic Entitlement
Subject to the fulfilment of the conditions set out below and in
Part IV of the Circular, Qualifying Shareholders are being given
the opportunity to subscribe for Open Offer Shares under the Open
Offer at the Issue Price, payable in full on application and free
of all expenses, pro rata to their existing shareholdings on the
following basis:
20 Open Offer Shares for every 27 Existing Ordinary Shares
held by Qualifying Shareholders and registered in their name at
the Record Date.
Open Offer Entitlements under the Open Offer will be rounded
down to the nearest whole number and any fractional entitlements to
Open Offer Shares will not be allocated and will be disregarded.
Qualifying Shareholders with holdings of Existing Ordinary Shares
in both certificated and uncertificated form will be treated as
having separate holdings for the purpose of calculating their Basic
Entitlement.
If you have sold or otherwise transferred all of your Ordinary
Shares after the ex-entitlement Date, you are not entitled to
participate in the Open Offer.
The Open Offer is not a rights issue. Qualifying CREST
Shareholders should note that, although the Open Offer Entitlements
will be admitted to CREST and be enabled for settlement,
applications in respect of entitlements under the Open Offer may
only be made by the Qualifying Shareholder originally entitled or
by a person entitled by virtue of a bona fide market claim raised
by Euroclear's Claims Processing Unit. Qualifying Non-CREST
Shareholders should note that the Application Form is not a
negotiable document and cannot be traded. Qualifying Shareholders
should be aware that under the Open Offer, unlike in a rights
issue, any Open Offer Shares not applied for will not be sold in
the market or placed for the benefit of Qualifying Shareholders who
do not apply under the Open Offer.
Application has been made for the Open Offer Entitlements of
Qualifying CREST Shareholders to be admitted to CREST. It is
expected that such Open Offer Entitlements will be admitted to
CREST on 14 December 2017. The Open Offer Entitlements will also be
enabled for settlement in CREST on 14 December 2017 to satisfy bona
fide market claims only. Applications through the CREST system may
only be made by the Qualifying CREST Shareholder originally
entitled or by a person entitled by virtue of a bona fide market
claim.
Further details of the Open Offer and the terms and conditions
on which it is being made, including the procedure for application
and payment, are contained in Part IV of the Circular and for
Qualifying Non-CREST Shareholders on the Application Form. To be
valid, Application Forms (duly completed) and payment in full for
the Open Offer Shares applied for must be received by Share
Registrars Limited, The Courtyard, 17 West Street, Farnham, Surrey
GU9 7DR, by no later than 11 a.m. on 29 December 2017.
Qualifying Non-CREST Shareholders will receive an Application
Form which sets out their maximum entitlement to Open Offer Shares
as shown by the number of Basic Entitlements allocated to them.
The Open Offer is restricted to Qualifying Shareholders in order
to enable the Company to benefit from exemptions from securities
law requirements in certain jurisdictions outside the United
Kingdom.
Excess Application Facility
The Excess Application Facility will enable Qualifying
Shareholders, provided that they take up their Basic Entitlements
in full, to apply for Excess Entitlements to the extent that if a
Qualifying Shareholder has taken up its Basic Entitlements in full
and applies for and is allocated the maximum Excess Entitlements it
will suffer no dilution as a result of the Placing and Open Offer.
Qualifying Non-CREST Shareholders who wish to apply to acquire more
than their Basic Entitlements should complete the relevant sections
on the Application Form. Qualifying CREST Shareholders will have
Excess Entitlements credited to their stock account in CREST and
should refer to paragraph 3(ii) of Part IV of the Circular for
information on how to apply for Excess Entitlements pursuant to the
Excess Application Facility. Applications for Excess Entitlements
will be satisfied only and to the extent that corresponding
applications by other Qualifying Shareholders are not made or are
made for less than their Basic Entitlements and may be scaled back
at the Company's absolute discretion.
Once subscriptions by Qualifying Shareholders under their Basic
Entitlements have been satisfied, the Company shall, in its
absolute discretion, determine whether or not to meet any
applications for Excess Entitlements in full or in part and no
assurance can be given that applications by Qualifying Shareholders
under the Excess Application Facility will be met in full, in part
or at all. Application will be made for the Basic Entitlements and
Excess Entitlements in respect of Qualifying CREST Shareholders to
be admitted to CREST. It is expected that Open Offer Shares issued
pursuant to subscriptions by Qualifying Shareholders exercising
their Basic Entitlements and Excess Entitlements will be admitted
to CREST at 8.00 a.m. on 5 January 2018. Such Open Offer Shares
will also be enabled for settlement in CREST at 8.00 a.m. on 5
January 2018. Applications through the means of the CREST system
may only be made by the Qualifying Shareholder originally entitled
or by a person entitled by virtue of a bona fide market claim.
Qualifying Non-CREST Shareholders will receive an Application Form
which sets out their entitlement to Open Offer Shares as shown by
the number of Basic Entitlements allocated to them. Qualifying
Non-CREST Shareholders should note that the Application Form is not
a negotiable document and cannot be traded.
Qualifying CREST Shareholders will receive a credit to their
appropriate stock accounts in CREST in respect of their Basic
Entitlements and Excess Entitlements on 14 December 2017.
Qualifying CREST Shareholders should note that although the Basic
Entitlements and Excess Entitlements will be admitted to CREST and
be enabled for settlement, applications in respect of their Open
Offer Entitlements may only be made by the Qualifying Shareholder
originally entitled or by a person entitled by virtue of a bona
fide market claim. If applications are made for less than all of
the Open Offer Shares available, then the lower number of Open
Offer Shares will be issued and any outstanding Basic Entitlements
will lapse.
Further information on the Open Offer and the terms and
conditions on which it is made, including the procedure for
application and payment, are set out in Part IV of the Circular.
For Qualifying Non-CREST Shareholders, completed Application Forms,
accompanied by full payment, should be returned by post, or by hand
(during normal business hours only), Share Registrars Limited, The
Courtyard, 17 West Street, Farnham, Surrey GU9 7DR, so as to arrive
as soon as possible and in any event so as to be received no later
than 11.00 a.m. on 29 December 2017. For Qualifying CREST
Shareholders the relevant CREST instructions must have been settled
as explained in the Circular by no later than 11.00 a.m. on 29
December 2017.
Action to be taken in respect of the Open Offer
If you are a Qualifying Non-CREST Shareholder you will be sent
an Application Form which gives details of your Basic Entitlement
(i.e. the number of Open Offer Shares available to you). If you
wish to apply for Open Offer Shares under the Open Offer, you
should complete the Application Form in accordance with the
procedure set out at paragraph 3(i) of Part IV of the Circular and
on the Application Form itself and post it, or return it by hand
(during normal business hours only), together with payment in full
in respect of the number of Open Offer Shares applied for to Share
Registrars Limited, The Courtyard, 17 West Street, Farnham, Surrey
GU9 7DR, so as to arrive as soon as possible and in any event so as
to be received no later than 11 a.m. on 29 December 2017 2017,
having first read carefully Part IV of the Circular and the
contents of the Application Form.
If you are a Qualifying CREST Shareholder, no Application Form
will be sent to you. As a Qualifying CREST Shareholder you will
receive a credit to your appropriate stock account in CREST in
respect of your Basic Entitlement. You should refer to the
procedure set out at paragraph 2 and paragraph 3 (ii) of Part IV of
the Circular.
The latest time for applications to be received under the Open
Offer is 11.00 a.m. on 29 December 2017. The procedure for
application and payment depends on whether, at the time at which
application and payment is made, you have an Application Form in
respect of your Basic Entitlement or your Basic Entitlement has
been credited to your stock account in CREST. The procedures for
application and payment are set out in Part IV of the Circular.
Further details also appear on the Application Form which has been
sent to Qualifying Shareholders. Qualifying CREST Shareholders who
are CREST sponsored members should refer to their CREST sponsors
regarding the action to be taken in connection with the Circular
and the Open Offer.
If you are in any doubt as to the procedure for acceptance,
please contact Share Registrars Limited on +44 1252 821 390. The
helpline is open between 9.00 a.m. to 5.30 p.m., Monday to Friday
excluding public holidays in England and Wales. Please note that
Share Registrar Limited cannot provide any financial, legal or tax
advice and calls may be recorded and monitored for security and
training purposes.
If you are in any doubt as to the contents of the Circular
and/or the action you should take, you are recommended to seek your
own personal financial advice from an independent financial adviser
authorised under the Financial Services and Markets Act 2000 (as
amended) if you are in the UK or, if you are outside the UK, from
an appropriately authorised independent financial adviser, without
delay.
6. Action to be taken
Action to be taken in respect of the Open Offer is set out in
paragraph 7 above and also in Part IV of the Circular. If you are a
Qualifying Non-CREST Shareholder, an Application Form will be
posted for completion by Qualifying Shareholders who wish to
participate in the Open Offer. If you are a Qualifying CREST
Shareholder, no Application Form will be sent to you. As a
Qualifying CREST Shareholder you will receive a credit to your
appropriate stock account in CREST in respect of your Basic
Entitlement. You should refer to the procedure set out at paragraph
3(ii) of Part IV of the Circular.
OPEN OFFER STATISTICS
Issue Price per New Ordinary Share 0.035 pence
Open Offer Basic Entitlement 20 Open Offer
Shares for
every 27
Ordinary
Shares at
Record date
Number of Ordinary Shares in issue
as at the date of the Circular1 3,809,903,314
Number of Ordinary Shares in issue
as at the Record Date 1,964,285,262
Maximum number of Open Offer Shares
to be issued pursuant to the Open
Offer 1,455,026,120
Maximum Enlarged Ordinary Share Capital up to
on Admission 5,264,929,434
Gross proceeds of the Open Offer up to GBP510,000
Estimated cash proceeds of the Open up to GBP480,000
Offer receivable by the Company (net
of expenses and assuming full allocation)
Percentage of the Enlarged Ordinary 27.6 per
Share Capital of the Company that cent.
the Open Offer Shares will represent
ISIN - Open Offer Basic Entitlements GB00BYVZ8H45
ISIN - Open Offer Excess Entitlements GB00BYVZ8K73
(1) This follows completion of the Placing and subsequent
Directors & Loan conversion actions on 5 December 2017
Notes
Statistics are prepared on the basis that no Ordinary Shares
will be issued following the date of the Circular and before the
completion of the Open Offer
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
2017
Record Date and time for entitlements 6.00 p.m. on
under the Open Offer 1 December
Announcement of the Open Offer 13 December
Publication of the Circular and 13 December
Application Forms to Qualifying
Shareholders
Ordinary Shares marked 'ex' entitlement 13 December
by the London Stock Exchange
Basic Entitlements and Excess 14 December
Entitlements credited to CREST
accounts of Qualifying CREST Shareholders
Recommended latest time and date 4.30 p.m. on
for requesting withdrawal of Basic 21 December
Entitlements and Excess Entitlements
from CREST
Latest time and date for depositing 3.00 p.m. on
Basic Entitlements and Excess 22 December
Entitlements into CREST
Latest time and date for splitting 3.00 p.m. on
Application Forms (to satisfy 27 December
bona fide market claims only)
Latest time and date for receipt 11.00 a.m. on
of completed Application Forms 29 December
from Qualifying Shareholders and
payment in full under the Open
Offer or settlement of relevant
CREST instructions (as appropriate)
Expected date of Admission and
commencement of dealings of Open 8.00 a.m. on
Offer Shares 5 January 2018
Expected date for CREST accounts 5 January 2018
to be credited with Open Offer
Shares
Share certificates in relation 12 January 2018
to Open Offer Shares (where applicable)
dispatched by
Save for the date of publication of the Circular,
each of the times and dates above are subject
to change. Any such change, including any consequential
change in the Open Offer Statistics above, will
be notified to Shareholders by an announcement
on a Regulatory Information Service. All times
are London times and each of the times is subject
to change.
- ENDS -
For further information please visit www.strat-aero.com or
contact:
Strat Aero plc Tel: +44 (0) 1293 804741
Graham Peck (Chairman)
SP Angel Corporate Finance LLP Tel: +44 (0) 20 3470
0470
Nominated Adviser and Joint
Broker
Stuart Gledhill
Jeff Keating
Caroline Rowe
Peterhouse Corporate Finance Tel: +44 (0) 20 7469
0930
Lucy Williams
St Brides Partners Ltd Tel: +44 (0) 20 7236
1177
Financial PR
Susie Geliher
Frank Buhagiar
Notes
Strat Aero plc is a multi-divisional international aerospace
services company, focused primarily on the provision of complete
client solutions in the Unmanned Aerial System ('UAS' market),
which is predicted to show exponential growth over the coming
decade. Commercial and military applications in UASs are expected
to be a dynamic growth sector in the aerospace industry over the
next 10 years with the UAS market forecast to grow to more than
US$82.1 billion between 2015 and 2025 (AUVSI Economic Report 2013)
and the global airborne Intelligence, Surveillance and
Reconnaissance ('ISR') market estimated to grow to US$19.23 billion
by 2023.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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