SRT Marine Systems secures £31m financing deal
Bath-based SRT Marine Systems has agreed a major investment and short-term finance bridge support package from existing shareholder Ocean Infinity (OI), together worth approximately £31m.
The company, which makes maritime domain awareness systems and technologies for security, safety and environmental protection, said the new financing enables it to immediately satisfy the need for the substantial performance bond required under the terms of a recently secured $213m (£162m) contract to deliver a major project for an unnamed government.
The contract is expected to be signed and start on October 31.
SRT will issue up to 21.5m new ordinary shares at an issue price of 35p per share by way of a placing which is entirely underwritten by OI, raising gross proceeds of £7.5m. Existing shareholders will be given the right to acquire up to a maximum of 7.5m shares in aggregate, with OI reserved a minimum of 14m shares.
Subject to shareholder approval, the company has agreed to complete the fundraising at the earliest opportunity in November. A further announcement will be made in due course.
OI has provided a $21.4m guarantee to SRT to enable SRT to issue a contract performance bond of similar value.
Oliver Plunkett, board member and CEO of OI, will join SRT’s board as a non-executive director following the completion of the placing.
Simon Tucker, CEO of SRT Marine Systems, said: “This financing package enables SRT to make a truly transformational commercial leap and very significantly accelerate the financial performance of the company through the simultaneous delivery of over $400m of contracts and with capacity for more.
“Besides the obvious product and technology synergies between OI and SRT in the MDA space, we are fortunate to have this level of support which enables us to confidently deliver on these contracts whilst also taking full advantage of our growing pipeline of future opportunities which we expect to continue to grow, and deliver a flow of more new contracts.”
Oliver Plunkett, Group CEO of Ocean Infinity, said: “This contract awarded to SRT in which Ocean Infinity will play a key supporting role is precisely the kind of opportunity to work together that we foresaw when we first invested in the Company. We strongly believe in the relationship, the wider market opportunity for maritime data and systems, and the long-term potential for both companies to continue working together for the benefit of our clients and each other.
“That long term vision is why we have seized this opportunity to provide additional equity funding to SRT as well as help out in the short term with a bridge guarantee which will facilitate SRT providing the necessary up front contractual guarantees to their customer as they wait for UKEF to complete their processing.”
