Placing to raise £400,000 and other matters
Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement, this information is now considered to be in the public domain.
24 April 2019
Vela Technologies plc
("Vela" or "Vela Technologies" or the "Company")
Placing to raise £400,000
Proposed follow-on investment in Portr Limited
Thomas Cook partnership with AirPortr
Proposed further investment by Director and substantial shareholder
Valuation of Vela's investee companies
Proposed conversion and early redemption of Convertible Unsecured Loan Notes
Appointment of Joint Broker
Introduction
The Board of Vela Technologies announces that it has conditionally raised gross proceeds of £400,000 through a placing (the "Placing") of 400,000,000 new ordinary shares in Vela at a placing price of 0.10 pence per share (the "Placing Shares"). The Placing is being conducted utilising Vela's existing share authorities and further details on the use of proceeds of the Placing are detailed below.
Conditional on shareholder approval at a General Meeting of Vela, investors subscribing in the Placing will also receive 1 warrant for every 4 Placing Shares, exercisable at 0.15 pence per placing warrant, for a period of up to 2 years from issue.
In conjunction with the Placing, Vela announces that it intends to enter into an agreement to invest a further £91,341 in Portr Limited ("Portr"), using proceeds from the Placing. The investment by Vela is part of a funding round being carried out by Portr.
Vela will update investors with the full details of the Portr funding round together with a trading update from Portr shortly.
Portr is the owner of Airportr, the airline integrated home bag check-in and delivery service that gives passengers the option to check in online and have their baggage collected from their doorstep. Following a positive ID match and airline security validations which are performed with the customer by a vetted driver utilising AirPortr's proprietary technology, baggage is put in a unique coded, tamper proof and trackable security bag, to be delivered to the airport and directly onto the designated departing flight. The passengers can then travel bag free to the airport, avoiding check-in or bag drop, instead going directly through security, collecting their luggage on arrival at their destinations' baggage reclaim.
Thomas Cook partnership with Airportr
-Vela notes the recent press coverage in relation to AirPortr's partnership with Thomas Cook, the seventh airline to sign up to the service platform, whereby customers departing with Thomas Cook Airlines from London Gatwick, can check in their baggage online and skip the queues at the airport.
Extracts from the press release are copied below:
"Thomas Cook Airlines has launched a partnership with home baggage check-in experts, AirPortr.
Available for customers departing with Thomas Cook Airlines from London Gatwick, customers can check in their baggage from the comfort of their own home and skip the queues at the airport.
Customers will then see their bags again at the baggage carousel in their destination airport. Here's how it works:
· Customers book a collection slot online at airportr.com or thomascookairlines.com
· Luggage is sealed and checked-in at the customer's home, typically the day before they fly, from any address in London or the surrounding area
· AirPortr delivers the bags directly onto the customer's flight, allowing them to travel to the airport bag-free, skip bag drop and head straight to security
· Customers are kept informed on the location and status of their bags every step of the way via email and SMS
Andrew Gillies, Head of Product & Ancillaries, Thomas Cook Group Airline says, "We are committed to innovating for our customers, so we explore anything that can make flying with us an even smoother experience.
"AirPortr allows our customers to check bags in from their own front door so they can travel easily across London without heavy baggage, travel seamlessly through the airport, enjoy their flight and start their holiday stress-free. We hope to expand this service with AirPortr to more of our UK departure airports in the near future."
Randel Darby, CEO at AirPortr says, "We are delighted to be helping Thomas Cook Airlines customers escape the everyday airport experience. Home bag check-in is a perfect fit, allowing customers to start their holiday the moment they leave the house. Travelling without bags and skipping busy airport queues makes the whole process of going on holiday so much more enjoyable, and we can't wait for Thomas Cook Airlines customers to experience this new way of traveling."
Since launching in late 2016, AirPortr has transported over 90,000 bags, skis and bikes to more than 320 destination baggage reclaims around the world. A short video showing how customers travel to the airport before and after AirPortr can be viewed here.
Book today at https://www.thomascookairlines.com/en/book-plan/partner/ airportr-baggage-collection.jsp or www.airportr.com/thomascook. Prices start at £30 for collection and check-in of one bag with a one-hour collection slot, or check in up to four bags with a three-hour slot from only £40, which is ideal for families."
The full press release by Thomas Cook is available here: https://www.thomascookgroup.com/news/18042019/check-in-luggage-from-home-with-thomas-cook-airlines-airportr?ref=Home
The Board of Vela believes that it is encouraging that Thomas Cook hopes to expand the service with Airportr to more of its UK departure airports, in the near future.
Antony Laiker, Executive Director of Vela, commented:
"Following on from the announcement of the Placing and the proposed follow-on investment in Portr together with the new partnership with Thomas Cook, we are looking forward to being able to provide further updates not only on Airportr but also other investee companies such as Vibe Group, StreamTV Networks and WeShop. All of these companies are at exciting stages of their development.
In addition, it will be interesting to see what emerges with Argo Blockchain where, despite interest from activist investors, the shares are priced at a 40% discount to net cash which we believe may increase due to the recent rise in the price of Bitcoin.
Once again, I would encourage investors to follow Vela Technologies on social media, where we will continue to post on matters relating to our investee companies so that investors can be better informed."
Details of the Placing
Vela has conditionally raised £400,000 (before expenses) through a placing of 400,000,000 new ordinary shares of 0.10 pence each in the capital of Vela at a placing price of 0.10 pence per Placing Share (the "Placing Price"). The funds raised will be used as follows:
• The investment of £91,341 in Portr (as detailed above);
• Repayment of £200,000 Convertible Unsecured Loan Notes held by Antony Laiker (a Director of the Company);
• To enable the Company to take advantage of further investment opportunities as and when they arise; and
• General working capital purposes.
Conditional on the approval of shareholders at a General Meeting, subscribers in the Placing will be issued with 1 warrant for every 4 Placing Shares exercisable at 0.15 pence per placing warrant, for a period of up to 2 years from issue. As a result of the issue of the Placing Shares, Vela does not have sufficient allotment authority to enable the placing warrants to be exercised in full. A circular containing a notice convening a General Meeting of Vela will be posted to shareholders in due course with the purpose of, inter alia, putting in place the requisite share authorities to cover the placing warrants being exercised in full.
As part of the Placing, Antony Laiker, Executive Director of Vela, intends to subscribe for 25,000,000 Placing Shares at the Placing Price.
Separately Kevin Sinclair, a substantial shareholder of Vela, having an interest in approximately 12.72 per cent. of the voting rights of Vela, has subscribed for 45,000,000 Placing Shares at the Placing Price.
The participations of Antony Laiker and Kevin Sinclair in the Placing constitute related party transactions pursuant to rule 13 of the AIM Rules for Companies. The independent director of Vela (being Brent Fitzpatrick) considers, having consulted with Vela's Nominated Adviser, Allenby Capital Limited, that the terms of the participations by Antony Laiker and Kevin Sinclair in the Placing are fair and reasonable insofar as its Shareholders are concerned.
Convertible Unsecured Loan Notes
In October 2016, Vela issued £200,000 of 8% Convertible Unsecured Loan Notes (the "Loan Notes") to each of Antony Laiker (a Director of Vela) and Scott Fletcher (a significant shareholder of Vela as defined under the AIM Rules for Companies). The Loan Notes could be repaid at Vela's request at any time up until 30 September 2018 or capable of conversion at a price of 0.15 pence per share at any time up until the repayment date. In November 2018, the repayment date of the Loan Notes was extended to 30 September 2019, with all other terms remaining unchanged. Further details of the Loan Notes can be found in the Company's announcements of 9 September 2016, 1 October 2018 and 30 November 2018.
Conversion of Loan Notes held by Scott Fletcher
Vela has entered into an agreement with Scott Fletcher to vary the terms of his £200,000 of Loan Notes (the "Scott Fletcher Loan"), such that the principal and the accrued interest will be converted into new ordinary shares in Vela at a conversion price of 0.10 pence per share, equivalent to the placing price. The 240,985,301 new ordinary shares issued pursuant to the conversion of the Scott Fletcher Loan and accrued interest (the "Scott Fletcher Loan Conversion Shares") will be issued within Vela's share allotment authorities put in place at the time of the creation of the Loan Notes in 2016 and will be subject to a lock-in agreement for a period of 3 months from the date of Admission.
Proposed repayment of Loan Notes held by Antony Laiker
Vela announces that it has entered into an agreement with Antony Laiker in respect of his £200,000 of Loan Notes (the "Antony Laiker Loan"), such that the principal and the accrued interest will be repaid in accordance with the terms of the Loan Note agreement. Following the repayment by Vela of the Antony Laiker Loan, and the accrued interest, Antony Laiker will use the entire proceeds of the repayment of the Antony Laiker Loan and the accrued interest to subscribe for new ordinary shares in Vela at a price of 0.10 pence per share (the "Antony Laiker Subscription"), equivalent to the Placing Price.
Antony Laiker and Vela intend to enter into an agreement shortly in relation to the Antony Laiker Subscription which will be conditional on, inter alia, completion of the Placing, full repayment of the Antony Laiker Loan and accrued interest and authority being given in a General Meeting of Vela to issue the new ordinary shares pursuant to the Antony Laiker Subscription.
The Antony Laiker Subscription will constitute a related party transaction under rule 13 of the AIM Rules for Companies. The independent director of Vela (being Brent Fitzpatrick) considers, having consulted with Vela's Nominated Adviser, Allenby Capital Limited, that the terms of the Antony Laiker Subscription are fair and reasonable insofar as shareholders are concerned.
The issue of the new ordinary shares pursuant to the Antony Laiker Subscription will be subject to shareholder approval of the granting of the requisite share authorities at the general meeting. The ordinary shares issued pursuant to the Antony Laiker Subscription will be subject to a lock-in agreement for a period of 3 months from the admission of the shares to trading on AIM.
A further announcement will be made by Vela in relation to the convening of a General Meeting of Vela to provide Vela will sufficient share authorities to cover the issue of the placing warrants to the subscribers of the placing shares and the issue of new ordinary in Vela pursuant to the Antony Laiker Subscription. It is the intention of Vela to hold the general meeting by the end of May 2019.
Details of Admission
Application has been made for the admission of the Placing Shares and the Scott Fletcher Loan Conversion Shares to trading on AIM. It is anticipated that Admission will occur on or around 2 May 2019. Following Admission, the Placing Shares will represent, in aggregate, approximately 27.1% of the issued share capital of Vela as enlarged by the issue of the Placing Shares and the Scott Fletcher Loan Conversion Shares. The Placing and the conversion of the Scott Fletcher Loan have been undertaken under Vela's existing share allotment authorities.
Valuation of investee companies
The Directors would like to take this opportunity to present a summary of previously disclosed valuations of Vela's investee companies. These valuations are based either on the current prevailing mid-market price (if the investee company is listed), cost (if the investee company is unlisted) or at the latest valuation (if the investee company is unlisted and there has been significant follow on investment or reason to make an adjustment). Based on this valuation methodology the sum of the parts valuation of Vela's investments equates to £2.285m. This calculation includes the Board's expectation of Vela's book value for Portr following completion of its proposed investment in the Portr funding round (as detailed above). This calculation is unaudited but applies the same valuation methodology applied as at the last balance sheet date of 30 September 2018, which is also consistent with the valuation methodology applied in Vela's audited financial statements for the year ended 31 March 2018.
Appointment of Joint Broker
Vela announces the appointment of SVS Securities plc as the Company's joint broker to work alongside its existing broker, Smaller Company Capital Limited, with immediate effect.
Total Voting Rights
On Admission of the 400,000,000 Placing Shares and 240,985,301 Scott Fletcher Loan Conversion Shares, Vela's issued ordinary share capital will consist of 1,477,958,416 Ordinary Shares, with one voting right each. Vela does not hold any Ordinary Shares in treasury. Therefore, on Admission, the total number of Ordinary Shares and voting rights in Vela will be 1,477,958,416. With effect from Admission, this figure may be used by shareholders in Vela as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of Vela under the FCA's Disclosure Guidance and Transparency Rules.
For further information, please contact:
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Vela Technologies plc |
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Brent Fitzpatrick, Non-Executive Chairman Antony Laiker, Director
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Tel: +44 (0) 7802 262 443
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Allenby Capital Limited (Nominated Adviser) Nick Athanas/Asha Chotai
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Tel: +44 (0) 20 3328 5656 |
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Smaller Company Capital Limited (Joint Broker) Rupert Williams/Jeremy Woodgate
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Tel: +44 (0) 20 3651 2910 |
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SVS Securities Limited (Joint Broker) Elliot Hance
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Tel: +44 (0) 20 3700 0100 |
About Vela Technologies
Vela Technologies (AIM: VELA) is an investing company focused on early stage and pre-IPO long term disruptive technology investments. There are currently 12 investments in the portfolio which either have developed ways of utilising technology or developing technology with a view to disrupting the businesses or sector in which they operate. More recently, Vela Technologies has also started to focus on existing listed companies where valuations may offer additional opportunities.
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