€8.8m capital increase gives 12 convertible-free months to investors

As the total number of shares will rise from 251.9m to 369.1m (with an acquisition price 15% below the previous market price), the NAV valuation has also been negatively impacted. There are two positive takeaways from this capital increase.

First, Drone Volt has shown that it has the right targets when it comes to external growth, as it has shown through the acquisition of Aerialtronics (€6m added value).

Secondly, even though this capital increase significantly dilutes current shareholders (a -32% impact), Drone Volt has stated that it would no longer use dilutive instruments over the next 12 months. The increasing number of shares outstanding through equity lines has been the main reason for the price decrease. Should the number of shares remain stable going forward, we can expect some positive impact.

Drone Volt has increased its capital by offering 117.2 million new shares without preemptive rights for a total value of €8.8m to several selected investors. The issue at €0.075 is at a 20.2% discount compared to the 10 previous trading days’ average price.

The capital raised will be used for three main reasons:

• 50% for acquisitions (of which a portion has been engaged with the intention to acquire a Dutch drone player);
• 25% for R&D;
• 25% to finance the increase in working capital needs resulting from the increase in production linked to the Aquiline Drone contracts and to finance the first Linedrone.

As it is a dilutive process, the DCF has been negatively impacted.

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