Surface Transforms closes successful share placing, with open offer to follow
Knowsley-based specialist brakes manufacturer, Surface Transforms, has raised gross proceeds of £8.3m from a share placing.
The company also intends to raise approximately £2m, before expenses, through an open offer for qualifying shareholders.
The placing will fund working capital requirements as the specialist manufacturer gears up for a phased increase in production levels.
Surface Transforms issued 18,650,000 firm placing shares, 62,918,660 conditional placing shares and 1,350,000 subscription shares at an issue price of 10p per ordinary share, providing a discount of approximately 13% to the closing mid-market price of 11.5p on November 10, 2023. The placing also represents approximately 34.3% of the company’s existing ordinary shares.
Earlier this month the firm released a trading update for the 10 months to October 31, 2023, which revealed it is in talks on a £13m loan linked to ramping up capacity. Today’s placing announcement warned shareholders that the conditional placing and open offer are conditional on the company executing the loan facility agreement.
Surface Transforms chairman, David Bundred, said: “We would like to thank both existing and new shareholders for their support of this placing, particularly those existing larger shareholders who, in difficult market conditions, have increased their percentage holding in the company.
“Additionally, the open offer, accompanying the placing, has been scaled to provide existing non-institutional shareholders the opportunity, should they so wish, to support the company to both minimise their dilution and also support the company in its next phase of growth.”
He added: “The placing, in combination with the anticipated loan and future free cash flows, provides the funding required to build £150m p.a. sales capacity in the period to 2027.
“We remain confident that, from the combination of our existing order book and potential pipeline conversion, we can deliver these revenues and also fill this capacity. This funding provides the financial foundation to maintain our momentum.”
Early last month the company, which makes carbon fibre reinforced ceramic brakes for high performance cars, as well as aircraft, announced a new order worth more than £100m over a seven year period with one of the world’s largest automotive OEMs (original equipment manufacturer).
