Vehicle electrification firm Equipmake Holdings PLC is looking to raise £3 million via a share placing and subscription.
The East Anglian firm, which serves the automotive, truck, bus and speciality vehicle industries, said the placing of £2.1m and subscription of £900,000 would be used to underpin the execution of its refocussed commercialisation strategy.
It has a working capital requirement for the next 12 months of approximately £5.5m.
The issue price of the new shares represents a premium of approximately 9.1% to the closing price on Thursday. The subscription includes existing and new investors, including an existing corporate partner and a director of the company.
Equipmake also reported its annual results. For the year ended 31st May 2024, sales rose to £8.1m, a 60% increase on the previous 12 months.
“The board recognises that the group had limited cash resources, insufficient cash resources to take the group to profitability, and therefore it will require further financing over the next 12 months in order to implement its growth strategy and to get to cash breakeven and profitability,” it stated.
“The company is currently evaluating various sources of further additional finance.”
Equipmake said it is in advanced stage discussions regarding a licence agreement with a major automotive supplier and that, should this be agreed on the terms currently envisaged – which include a total of £4.6m of milestone payments over the two years – the group would anticipate reaching profitability.
“If, however, the licence agreement were not to be consummated on the timetable envisaged, the board recognises that the group would have insufficient cash resources to take the group to profitability, and it would require further financing over the next 12 months in order to implement its growth strategy and to achieve cash breakeven and profitability,” it warned.
Ian Foley, CEO of Equipmake, said: “We are delighted with the strong revenue growth achieved in the year and with the deepening customer engagements, particularly with OEM partners and Tier 1 suppliers, which reflects our focus going forwards of increasing proportions of revenues from the supply of EV components, drivetrain solutions and through high-value licence transactions.
“We believe we have addressed the cost issues that we experienced in bus repowering during the year by now securing substantially lower cost batteries and other selected components through alternative suppliers and, having had a very busy start to the year, expect strong growth in the year.
“We have also been working hard to secure additional funding, which we expect to update the market on very soon.
“Our commitment remains to achieve profitability and cash breakeven as soon as possible.”
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