Vertical Aerospace (Vertical) (NYSE: EVTL) (“Vertical” or the “Company”), a global leader in aerospace and technology focused on pioneering electric aviation, has announced the launch of an underwritten public offering valued at $75 million (the “Offering”). This Offering is designed to raise capital through the issuance of units, with each unit comprising one ordinary share, one-half of a Tranche A warrant, and one-half of a Tranche B warrant. Importantly, the ordinary shares and warrants included in these units will be immediately separable and issued as distinct securities. However, the Offering remains subject to market conditions and other factors, and there is no certainty regarding its completion or the final terms.
William Blair has been appointed as the lead bookrunner, while Canaccord Genuity will act as the joint bookrunner for this Offering. These reputable institutions are responsible for facilitating the process, including marketing the Offering to potential investors and ensuring regulatory compliance.
Strategic Allocation of Proceeds
Vertical Aerospace plans to allocate the net proceeds from the Offering to various critical areas of its operations. A significant portion will be directed toward advancing the research and development of the VX4, the Company’s electric vertical takeoff and landing (eVTOL) aircraft. This innovative aircraft is a cornerstone of Vertical’s mission to revolutionize urban air mobility by providing sustainable, efficient, and safe electric aviation solutions.
Additionally, Vertical Aerospace intends to enhance its testing and certification capabilities to ensure the VX4 meets the stringent regulatory and safety standards required for commercial operations. The funds will also support general working capital needs and other corporate purposes, enabling the Company to maintain its momentum in a rapidly evolving industry.
Key Features of the Offering
The units offered in this public offering include two types of warrants—Tranche A and Tranche B. Each warrant type offers investors specific terms and conditions for purchasing additional shares in the future, which could provide potential upside as the Company progresses toward its goals. However, it’s important to note that these warrants will not be listed on any exchange, unlike Vertical’s ordinary shares, which trade under the ticker symbol “EVTL” on the New York Stock Exchange (NYSE).
The Offering will be conducted under the framework of a preliminary prospectus supplement filed as part of the Company’s registration statement on Form F-3 (File No. 333-275430). This registration statement was initially filed with the U.S. Securities and Exchange Commission (SEC) on November 9, 2023, and subsequently declared effective on November 16, 2023. Copies of the preliminary prospectus supplement can be obtained through the SEC’s website or directly from the underwriters, William Blair and Canaccord Genuity, using the provided contact details.
Regulatory and Legal Considerations
Vertical Aerospace’s Offering is governed by U.S. securities laws and regulations, ensuring transparency and investor protection. It is emphasized that the Offering will only proceed in jurisdictions where it complies with applicable laws. The final terms and details will be outlined in a prospectus supplement to be filed with the SEC, ensuring that potential investors have access to comprehensive information before making investment decisions.
Market Outlook and Industry Context
The announcement of this Offering comes at a time of significant growth and innovation within the electric aviation sector. As a pioneer in this space, Vertical Aerospace is positioned to capitalize on the increasing demand for sustainable transportation solutions. The VX4, which represents a breakthrough in eVTOL technology, has garnered substantial interest from industry stakeholders and potential customers.
The global push toward reducing carbon emissions and enhancing urban mobility has created a favorable environment for companies like Vertical Aerospace. By leveraging its expertise in aerospace engineering and electric propulsion, Vertical aims to address these challenges while delivering value to its shareholders and customers.
Potential Risks and Opportunities
While the Offering presents an opportunity for Vertical Aerospace to strengthen its financial position and accelerate its development programs, there are inherent risks associated with such undertakings. Market volatility, regulatory hurdles, and competition within the eVTOL industry are key factors that could impact the Company’s progress.
However, the successful completion of the Offering could enhance Vertical Aerospace ability to achieve its strategic objectives and maintain its leadership in electric aviation. By securing the necessary funding, the Company can continue to innovate, expand its operations, and contribute to the transformation of urban transportation.
Vertical Aerospace’s $75 million public offering represents a significant milestone in its journey to revolutionize air mobility. With a clear focus on advancing the VX4 and strengthening its operational capabilities, the Company is taking proactive steps to position itself for success in a dynamic and competitive industry. As the Offering unfolds, stakeholders will closely monitor its progress and the potential implications for Vertical’s future trajectory.
Read more: Vertical Aerospace Unveils Proposed Underwritten Public Offering