LONDON - VivoPower International PLC (NASDAQ:VVPR), a sustainable energy solutions provider, has announced the successful closure of its F-1 offering, which concluded after market hours on Monday. The company issued 3,200,000 Ordinary Shares to institutional investors, generating approximately $4 million in gross proceeds.
The capital raised from this offering will be allocated primarily towards reducing the company's debt and funding inventory to fulfill customer orders. VivoPower's strategic transition to a capital light business model has significantly reduced its funding requirements, as it no longer needs to invest in assembly and manufacturing facilities. This shift allows the company to leverage its strategic supply chain across Asia more effectively.
The offering was managed by Chardan, which served as the sole placement agent. The securities were offered in accordance with a registration statement on Form F-1 filed with the U.S. Securities and Exchange Commission (SEC) on July 26, 2024, and declared effective on August 29, 2024. The final prospectus was filed with the SEC on September 19, 2024, and is available on the SEC's website.
VivoPower, established in 2014 and listed on Nasdaq since 2016, operates as a B Corporation, focusing on electric solutions for customized fleet applications, including off-road and on-road vehicles. The company also offers financing, charging, battery, and microgrid solutions to support its core purpose of providing turnkey decarbonization solutions that assist customers in moving towards net-zero carbon status. VivoPower has a presence in several countries, including Australia, Canada, the Netherlands, the United Kingdom, the United States, the Philippines, and the United Arab Emirates.
This press release statement is the basis for the current report and does not constitute an offer to sell or a solicitation of an offer to buy any securities. Furthermore, no sales of these securities will occur in jurisdictions where such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The information provided is factual, and the company has not endorsed any claims made in this report.
In other recent news, VivoPower International Plc and Future Automotive Solutions and Technologies (FAST) have announced a strategic agreement to merge, aiming to leverage the UK's clean energy initiatives. The proposed merger values the combined entity at $1.13 billion, with VivoPower and FAST shareholders owning 49% and 51% respectively. These recent developments are part of a larger trend of increased investment in the UK's clean energy transition sector, as reported by Bloomberg New Energy Finance.
In financial updates, VivoPower reported a 22% year-on-year decline in annual consolidated revenue to $11.8 million for the fiscal year ending June 30, 2024. Despite the revenue drop, gross profit from continuing operations increased to $1.6 million, up from a $2.3 million gross loss in the previous year. The company also reported an underlying net after-tax loss of $25.1 million, with earnings per share falling to ($8.01).
In another major development, VivoPower's subsidiary Tembo E-LV and Cactus (NYSE:WHD) Acquisition Corp. 1 Limited have agreed on a business combination valuing the combined enterprise at $904 million. If completed, this merger will result in Tembo becoming a separately listed company on NASDAQ, with VivoPower expected to remain the majority shareholder. This follows VivoPower's strategic shift towards Electric Vehicle and Sustainable Energy Solutions, as evidenced by the sale of Kenshaw Electrical, a Critical Power business unit, for approximately A$5.0 million.
InvestingPro Insights
VivoPower International's recent F-1 offering comes at a critical time for the company, as revealed by InvestingPro data and tips. The company's market capitalization stands at a modest $4.53 million, reflecting its current financial position. This capital raise of approximately $4 million is significant, nearly doubling the company's market value.
InvestingPro Tips highlight that VivoPower "operates with a significant debt burden" and "may have trouble making interest payments on debt." These insights underscore the importance of the company's decision to allocate a portion of the raised capital towards debt reduction. The tip suggesting that VivoPower is "quickly burning through cash" further emphasizes the timely nature of this offering.
Despite these challenges, there are some positive indicators. An InvestingPro Tip notes that "analysts anticipate sales growth in the current year," which aligns with the company's plan to use some of the proceeds to fund inventory for customer orders. This could potentially help improve VivoPower's revenue, which stood at $12.24 million in the last twelve months as of Q2 2024, according to InvestingPro data.
However, investors should be aware that the stock "has fallen significantly over the last year," with a one-year price total return of -72.11%. The company is also "not profitable over the last twelve months," which explains its negative P/E ratio of -0.31.
For a more comprehensive analysis, InvestingPro offers 18 additional tips for VivoPower International, providing investors with a deeper understanding of the company's financial health and market position.
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