First Day of Dealings

RNS Number : 1248X

Strat Aero PLC

17 November 2014

 



THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE AN ADMISSION DOCUMENT AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO SELL OR ISSUE, OR ANY SOLICITATION OF ANY OFFER TO PURCHASE OR SUBSCRIBE FOR, ANY ORDINARY SHARES IN THE CAPITAL OF THE COMPANY, NOR SHALL IT (OR ANY PART OF IT), OR THE FACT OF ITS DISTRIBUTION, FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH OR ACT AS ANY INDUCEMENT TO ENTER INTO, ANY CONTRACT OR COMMITMENT WHATSOEVER.

Strat Aero plc / Index: AIM / TIDM: AERO / Sector: Support Services

17 November 2014

Strat Aero plc ("Strat Aero", the "Company" or the "Group")

First Day of Dealings on AIM

Strat Aero plc, a revenue generative international aerospace services company currently focused on the provision of training solutions, management systems and consultancy services to the international aviation market, is pleased to announce the admission of its issued share capital to trading on AIM.  This follows the completion of a placing of 8,125,000 new Ordinary Shares at 8 pence per share to raise £650,000before expenses, giving the Company a market capitalisation of approximately £6.2 million on Admission at the Placing Price.  The funds raised will be used to provide working capital for the Company's existing and future business opportunities, particularly in relation to the fast growing Unmanned Aerial Systems market ('UAS').  SP Angel Corporate Finance LLP is nominated adviser and joint broker to the Company, and Beaufort Securities Limited acts as joint broker.

Overview

·     Established revenue generative aerospace services company well placed to capitalise on the exponential growth of the Unmanned Aerial Vehicles ('UAVs') market

·     Three existing divisions:

o  UAS Pilot Training and Services - operates from the fully functional and multi-faceted UAS Training Centre in Roswell, New Mexico

o  Aviation Software, Products and Services - proprietary advanced aerospace management system providing cloud-based enterprise wide management solutions for the aerospace sector and potentially, other sectors

o  Aviation Management and Consultancy Services - multiple contracts in place including project management of the establishment of a new low cost airline in the Middle East

·     Consultancy & development agreements in place with international aviation companies, government bodies and universities including:

o  Co-operation agreement signed with major US defence contractor to train military pilots to fly fixed wing UAVs - expected to commence at Roswell centre in Q4 2014  

o  Agreement signed with the National Renewable Energy Laboratory ('NREL'), a division of the US Department of Energy, to develop sUAS (small Unmanned Aerial Systems) technology for use in the commercial sector such as wind-farms and oil and gas fields

·     Civilian, law enforcement and military applications in UAS expected to be a dynamic growth sector in the aerospace industry over the next 10 years

·     £650,000 raised to provide working capital for existing and future business opportunities in the UAS and ISR sectors; and further investment into UAS and UAV hardware for applications within the law enforcement and commercial sectors

·     Highly skilled board and management team with a proven track record in providing multi-disciplined aviation services to both the public and private sectors

Capt. Russell Peck, CEO of Strat Aero, said,"Strat Aero offers a unique opportunity to gain exposure to the near exponential growth forecast for the UAV market and also to the wider aerospace industry.  The potential uses for UAVs in both the public, governmental and commercial sectors are seemingly limitless and highly varied, ranging from the delivery of goods by retailers to the monitoring of wind farm turbines and remote oil and gas fields, and search and rescue operations.  With a unique fully equipped UAV pilot training centre in Roswell and a co-operation agreement in place with a leading US defence contractor and the US Government's NREL, Strat Aero is ideally placed to capitalise on this rapidly growing market and become the go-to provider of bespoke UAV training and solutions. 

"While the UAS sector and our positioning offers tremendous scope to generate significant value for shareholders, Strat Aero is a multi-disciplined aerospace business with two other revenue generative divisions.  Our consultancy business is highly regarded in the aerospace industry, as demonstrated by the calibre of the contracts currently in place which include project managing the establishment of a new low cost airline in the Middle East and supplying the Department of Civil Aviation Cyprus with inspectors to assist with the evaluation of certificates submitted to the regulatory authority for approval  Meanwhile our proprietary aerospace management system, ERP (enterprise resource planning) software for the aviation sector, which is already being used by a large international aircraft cleaning company, is proven and ready for roll-out.  Following today's Admission to AIM, we are ideally positioned to build a cutting edge aerospace services company and I look forward to providing further updates on our progress." 

Enquiries:

Strat Aero plc
Russell Peck (Chief Executive)	Tel: [phone]
Graham Peck (Chairman)	Tel: [phone]
SP Angel Corporate Finance LLP	Tel: [phone]
Nominated Adviser and Joint Broker
Stuart Gledhill Katy Birkin
Beaufort Securities Limited	Tel: [phone]
Joint Broker Jon Levinson
Elliot Hance
St Brides Media & Finance Ltd	Tel: [phone]
Susie Geliher Frank Buhagiar

Defined terms used in this announcement have the same meaning as set out in the Company's Admission Document dated 7 November 2014.

SP Angel Corporate Finance LLP ("SP Angel"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for the Company as its nominated adviser and joint broker in connection with this announcement, the Placing and Admission and will not be acting for any other person or otherwise be responsible to any person for providing the protections afforded to customers of SP Angel or for advising any other person in respect of the Placing and Admission.

Beaufort Securities Limited ("Beaufort"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for the Company as joint broker in connection with this announcement, the Placing and Admission and will not be acting for any other person or otherwise be responsible to any person for providing the protections afforded to customers of Beaufort or for advising any other person in respect of the Placing and Admission.

Further Information

Strat Aero was established in 2014 by Captain Graham Peck and Captain Russell Peck (who are not

related) to capitalise on market opportunities resulting from the strong growth forecast in the airline industry and almost exponential growth forecast in the emerging UAV industry over the coming decade. By bringing together key components including high calibre personnel, proprietary training software, intellectual property and a UAS Pilot Training Centre at Roswell, the Group was established and is now looking for development capital and admission to AIM. The proceeds of the Admission will be used to fund growth in the business and to accelerate the implementation of the Group's strategic plans.

The Group's management team has close to an aggregate of 400 years of aviation management and training experience. The Group has procured additional expertise through its employees and consultants in aviation safety, occupational safety and health administration, organisational development, airline and airport management, UAV operations, regulatory writers, database management and government contracts. With this expertise, Strat Aero is able to provide a broad suite of aviation solutions, from various types of training and consultancy to regulatory publishing and airline/airport management.

The Company has identified the UAS market, the intelligence, surveillance and reconnaissance ("ISR") market and the increasing need for the commercial aviation industry to invest in new digital technology, including online and mobile computing, as areas of growth in which it is well placed to capitalise on due to the experience of its management team, existing contracts and MOU's and its established infrastructure.

To date, the Group's primary source of revenue has come from consultancy services provided to the international aviation industry. Funding has also been provided by the Directors and other investors in order to develop the Group's operational platform and to allow the Company to embark on its current growth plans.

Directors

Captain Graham Douglas Grindell Peck (Executive Chairman), aged 69, British

Captain Peck began his flying career in 1963 as a pilot in the UK Royal Navy flying fleet air defence fighters from both aircraft carriers and shore bases. During this time he qualified as a military flying instructor teaching fast jet students at the Royal Naval Advanced Flying Training School and embarked on a training career that spanned over 50 years. On leaving the military in 1972 he joined Dan Air, a UK charter airline and soon extended his training qualifications when he became a Line Training Captain on BAC 1-11 aircraft. This led to his qualification as a UK CAA Authorised Examiner and he subsequently held the position of Fleet Chief Training Captain on the B737 Fleet. The airline was absorbed into British Airways (BA") in 1993 and Captain Peck took the post of B737 Flight Manager in the new BA Euro Gatwick division. In 1998 he was seconded to GB Airways, a BA subsidiary airline as Chief Pilot and shortly after became the Director of Operations and a full board member. On reaching the BA compulsory retirement age he went freelance and in 2000 joined FlightSafety Boeing Training International (later known as Alteon), Boeing's training division, as the Head of Training for the EMEA region. He was responsible for the initial structuring of the training department and obtained the necessary regulatory approvals leading to the full type rating training organisation status for six training centres covering the UK, Europe, North Africa and Singapore. Since 2010, Captain Peck has run his own aviation consultancy business and worked in the development and delivery of innovative training and educational solutions to the aviation industry. Capt. Peck is a Fellow of the Royal Aeronautical Society. Capt. Peck is based in the United Kingdom.

Captain Russell Maurice Peck (Chief Executive Officer), aged 67, American

Captain Peck began his aviation career training foreign pilots for international airlines in Asia. He entered the corporate business jet industry early in his career flying the Lear Jet to both domestic and international destinations. He joined Continental Airlines ("Continental") in 1978 and became a Boeing 727 Flight Instructor, a Check Pilot and an FAA designated examiner. Capt. Peck also managed the DC9 and MD80 Fleet while acting at the Fleet Check Airman. He then became the Manager of Training Programs for Continental and served as the Continental representative for the Air Transportation Association training committee in Washington D.C. Capt. Peck was appointed Director of Human Factors and Corporate Training for Continental and additionally managed the Advanced Qualification Program for the airline.

He retired from Continental as a Boeing 757/767 Flight Instructor and Check Airman in 2006. During his time with Continental, in 1995 Capt. Peck joined CPaT Inc., a private computer based training company providing computer based training to airlines and type rating training organization worldwide. As President and Head of Marketing, he led the company to more than double its revenue and expand its international presence.

Capt. Peck has been a Member of the Association for Unmanned Vehicle Systems International in the United States since November 2013, as well as a Fellow of the Royal Aeronautical Society in the United Kingdom since December 2013.

In September 2013, the FAA announced that it recognized Capt. Peck with inclusion in the prestigious FAA Airmen Certification Database, which lists certified pilots who have met or exceeded the high educational, licensing and medical standards established by the FAA. Capt. Peck is based in Texas, United States.

Capt. Graham Peck and Capt. Russell Peck are not related.

Robert ("Bob") James Salluzzo (Chief Financial Officer), aged 67, American

Bob Salluzzo has been providing finance, accounting, management and business development services to public and private corporations and other organisations for over forty years. He is a Certified Public Accountant who began his career with PriceWaterhouseCoopers in Rochester, New York and then established his own practice in which he was a partner which was later merged into Marvin & Co. a major regional accounting firm in Albany, New York.

Mr Salluzzo has provided management support to both developing and growth companies and organisations entering a turnaround or restructuring phase including strategic fundraisings. Mr Salluzzo has advised on the structuring and securing of multi-million dollar debt and equity raises. He has operated in many business sectors and has a specialty in aviation consulting where he has advised airport owners and sponsors in entrepreneurial methods to mitigate costs on airports. He was the lead consultant in the construction of a general aviation airport in Canandaigua, New York. Mr Salluzzo has spoken before the New York State Airport Managers Association on the topics of business development and financing alternatives for airports and businesses on airports. He also was an integral participant in the launch and certification of a part 121 regional air carrier.

Mr Salluzzo is a commercial pilot type rated in the Citation 500/550 series and has flown as a member of a Fortune 500 flight department. He is an Honorably Discharged army officer. Mr Salluzzo is based in New York, United States.

Gregory ("Greg") Kuenzel (Non-executive Director), aged 43, British & Australian

Greg Kuenzel holds a Bachelor of Business Degree and is an associate of the Institute of Chartered

Accountants in England and Wales. Mr Kuenzel has over 18 years of experience in providing accounting, management and corporate advice in a diverse range of industry sectors in the UK, USA and Australia. For the past nine years he has worked with mostly AIM quoted companies providing corporate and financial consulting services. Mr Kuenzel is currently Chief Executive Officer of AIM quoted Noricum Gold Limited and Non-executive Director of FinnAust Mining plc. Greg is based in the United Kingdom.

Placing Statistics

Placing Price	8 pence
Number of Existing Ordinary Shares	68,843,437
Number of Placing Shares	8,125,000
Number of Ordinary Shares in issue following the Placing and Admission	76,968,437
Percentage of Enlarged Share Capital represented by the Placing Shares	10.6%
Market capitalisation upon Admission at the Placing Price	£6.2 million
Estimated gross proceeds of the Placing receivable by the Company	£650,000
Estimated net proceeds of the Placing receivable by the Company	£300,000
ISIN	GB00BQQPLG38
SEDOL	BQQPLG3
TIDM	AERO

For further information, information provided under AIM Rule 26 and the Company's Admission Document please see the Company's website: www.strat-aero.com.

Important Notice

This announcement is for information purposes only and does not constitute an admission document and does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any ordinary shares in the capital of the company, nor shall it (or any part of it), or the fact of its distribution, form the basis of, or be relied on in connection with or act as any inducement to enter into, any contract or commitment whatsoever.

This announcement is not for publication or distribution, in whole or in part, directly or indirectly, in or into the United States, Australia, Canada, the Republic of South Africa, Japan or any other jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession this announcement, or other information referred to herein, comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

The securities referred to herein may not be offered or sold, directly or indirectly, in the United States unless registered under the US Securities Act of 1933, as amended (the "US Securities Act") or offered in a transaction exempt from, or not subject to, the registration requirements of the US Securities Act. The offer and sale of securities referred to herein has not been and will not be registered under the US Securities Act or under the applicable securities laws of Australia, Canada, the Republic of South Africa or Japan. There will be no public offer of the Ordinary Shares in the United States, Australia, Canada, the Republic of South Africa or Japan. Subject to certain exceptions, the Ordinary Shares referred to herein may not be offered or sold in Australia, Canada, the Republic of South Africa or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, the Republic of South Africa or Japan.

No reliance may or should be placed by any person for any purpose whatsoever on the information contained in this announcement or on its completeness, accuracy or fairness. The information in this announcement is subject to change. Investments to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested. This announcement does not constitute a recommendation concerning the Placing. The value of shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of the Placing for the person concerned.

Forward Looking Statements

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These statements relate to, among other things, analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to the Company's future prospects, developments and business strategies. These forward-looking statements can be identified by their use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will" or the negative of those variations, or comparable expressions, including references to assumptions. The forward-looking statements in this announcement, including statements concerning projections of the Company's future results and operations are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements.

These forward-looking statements speak only as of the date of this announcement. The Group expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Group's expectations with regard thereto, any new information or any change in events, conditions or circumstances on which any such statements are based, unless required to do so by law or any appropriate regulatory authority.

 

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