- Founder and CEO Stephen Fitzpatrick commits to invest $50
million equity capital into Vertical Aerospace
- Initial tranche of $25 million at $10 per share; second tranche
of $25 million at a price to be determined
- Investment extends projected cash runway into Q2 2025 and will
support the continued development of the certification aircraft
design
- Vertical is engaged in discussions for further capital pending
the flight test campaign of its second prototype
- Vertical continues to target Type Certification towards the end
of 2026
Vertical Aerospace (Vertical) [NYSE: EVTL], a global aerospace
and technology company that is pioneering zero-emissions aviation,
announces today that it has secured $50 million in committed
funding from founder, majority owner and CEO, Stephen Fitzpatrick.
The investment provides the platform for further funding rounds and
extends Vertical’s projected cash runway into Q2 2025, supporting
the continued development of the certification aircraft design
following prototype testing this year. This certification aircraft
will then go into final regulatory testing before production.
This funding comes at an important period for the company as it
nears the completion of its second-generation, full-scale piloted
VX4 prototype at GKN Aerospace’s Global Technology Centre. The
aircraft will conduct a series of key public flight demonstrations
in 2024, including the intention to fly at Farnborough
International Airshow and to and from Heathrow Airport. These
flights are expected to demonstrate the significant technical and
engineering advancements made to the VX4. Following this flight
test programme and planned public demonstrations, Vertical expects
to be in position to refine and finalise its aircraft design.
Stephen Fitzpatrick, CEO & Founder of Vertical, said:
“Since founding Vertical in 2016 I have continued to believe in the
enormous potential the company has to pioneer zero carbon aviation.
The company has achieved significant technical progress both in its
prototype programme and its certification plans in 2023, that I
believe is not reflected in our share price. Given the success I
have seen in the past 12 months, I am more confident than ever in
our world class team, and I am delighted to further support the
company with additional funding.”
Mike Flewitt, Chairman of Vertical, said: “I am delighted
that Stephen has committed to further funding Vertical. His vision
and funding to date have enabled Vertical to be a frontrunner in
the Advanced Air Mobility industry and I look forward to both our
demonstrations and the completion of additional funding rounds to
deliver on the promise the VX4 has to offer our customers and their
passengers. We are on track to deliver a transformative UK
developed electric aircraft to our customers across the globe.”
The funding comes off the back of several major milestones
achieved by the company in 2023:
- Opening the Vertical Energy Centre in January and building a
complete battery powertrain with Molicel cells
- Receiving Design Organisation Approval (DOA) from the UK Civil
Aviation Authority (CAA) in March
- Completing the thrustborne test campaign with the full-scale
VX4 prototype by August
- Pre-orders for 1500 VX4 aircraft worth over $5bn from more than
a dozen customers worldwide by October
- Completing initial Technical Familiarisations with five global
aviation regulators and proceeding to a key design review for the
VX4
- Starting final assembly for the second VX4 full-scale piloted
prototype – which includes the technologies from the majority of
the VX4’s certification aircraft partners
- Strengthening the senior engineering team with hires across
aircraft design, flight test, airworthiness and powertrain
Vertical has an asset light, lower capital approach to eVTOL
aircraft development, supported by its tier-one aerospace partner
ecosystem and global operating partners. In 2023, Vertical’s
unaudited results indicate that its net cash used in operating
activities was approximately $95 million, emphasising its
disciplined approach to spend management.
Transaction summary
The Company and Mr. Fitzpatrick have entered into a legally
binding term sheet agreement in respect of an equity investment by
Mr. Fitzpatrick. Mr. Fitzpatrick will commit an initial tranche of
$25 million, which is expected to close by March 2024, for a
mixture of ordinary shares at $10 per share and warrants with a $5
exercise price, and a second tranche of $25 million by 31 July 2024
for ordinary shares at a price per share to be determined (such
second tranche to be reduced by the amount of alternative equity
funding secured by the Company by that date). As part of the
transaction, shareholders will vote on certain changes to the
Company’s articles of association with respect to Board composition
and proceedings at shareholder meetings; and the Company will
provide certain veto rights to Mr. Fitzpatrick, for so long as his
holding of the Company’s ordinary shares remains above certain
thresholds, in respect of certain changes to the company’s
articles, appointments, and certain issuances of shares and other
instruments. The closing of the transaction is subject to the entry
into of long-form agreements and other customary closing
conditions.
About Vertical Aerospace
Vertical Aerospace (NYSE: EVTL) is pioneering electric aviation.
The Company was founded in 2016 by Stephen Fitzpatrick, an
established entrepreneur best known as the founder of the OVO
Group, a leading energy and technology group and Europe’s largest
independent energy retailer. Vertical has focused on building the
most experienced and senior team in the eVTOL industry, who have
previously certified and supported over 30 different civil and
military aircraft and propulsion systems. Vertical received its
Design Organisation Approval in 2023 underlining the UK Civil
Aviation Authority’s confidence in Vertical’s capability to design
a safe and reliable aircraft and aviation-related products to the
highest standards.
Vertical’s top-tier partner ecosystem, including Honeywell
Aerospace, Leonardo, Hanwha, Dassault Systèmes, Molicel, and GKN
Aerospace, is expected to de-risk operational execution and its
pathway to certification allowing for a lean cost structure and
enabling production at scale. Vertical has a leading pre-order book
from a diverse global customer base, creating multiple potential
near term and actionable routes to market. Customers include
airlines, aircraft lessors, helicopter operators, mobility firms
and tourism groups, including American Airlines, Virgin Atlantic,
Avolon, Bristow, Marubeni, Kakao Mobility, Iberojet and
FLYINGGROUP, as well as Japan Airlines (JAL), Gol, Air Greenland,
Gozen Holding and AirAsia, through Avolon’s VX4 placements.
Final assembly of Vertical’s second, more advanced full-scale
VX4 prototype includes technology from Vertical’s tier-one
aerospace partners including Honeywell, GKN Aerospace, Hanwha,
Leonardo, Molicel and Solvay, each of which will contribute to the
certification VX4 aircraft. It also features improvements developed
by Vertical that include its next generation propellers and
proprietary battery pack technology, which has been developed at
its Vertical Energy Centre.
Vertical Media Kit Available here
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995 that relate to our current expectations and views of future
events. We intend such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements as
contained in Section 27A of the Securities Act and Section 21E of
the Exchange Act. Any express or implied statements contained in
this press release that are not statements of historical fact may
be deemed to be forward-looking statements, including, without
limitation, statements regarding the expected closing of the
committed funding transaction, including the entry into long-form
agreements and the satisfaction of all closing conditions, the
sufficiency of the proceeds from the committed funding to meet the
Company’s capital expenditure requirements until the time
specified, our ability and plans to raise additional capital to
fund our operations and support our growth and profitability
strategies, our future results of operations and financial
position, our plans for capital expenditures, the design and
manufacture of the VX4, our business strategy and plans and
objectives of management for future operations, including the
building and testing of our prototype aircrafts on timelines
projected, certification and the commercialization of the VX4 and
our ability to achieve regulatory certification of our aircraft
product on any particular timeline or at all, expectations
surrounding pre-orders and commitments, the features and
capabilities of the VX4, the transition towards a net-zero
emissions economy, as well as statements that include the words
“expect,” “intend,” “plan,” “believe,” “project,” “forecast,”
“estimate,” “may,” “should,” “anticipate,” “will,” “aim,”
“potential,” “continue,” “are likely to” and similar statements of
a future or forward-looking nature. Forward-looking statements are
neither promises nor guarantees, but involve known and unknown
risks and uncertainties that could cause actual results to differ
materially from those projected, including, without limitation: our
limited operating history without manufactured non-prototype
aircraft or completed eVTOL aircraft customer order; our history of
losses and the expectation to incur significant expenses and
continuing losses for the foreseeable future; the market for eVTOL
aircraft being in a relatively early stage; our potential inability
to produce, certify or launch aircraft in the volumes or timelines
projected; the potential inability to obtain the necessary
certifications for production and operation within any projected
timeline, or at all; any accidents or incidents involving eVTOL
aircraft could harm our business; our dependence on partners and
suppliers for the components in our aircraft and for operational
needs; the potential that certain strategic partnerships may not
materialize into long-term partnership arrangements; all of the
pre-orders received are conditional and may be terminated at any
time and any pre-delivery payments may be fully refundable upon
certain specified dates; any circumstances; the inability for our
aircraft to perform at the level we expect and may have potential
defects; any potential failure to effectively manage our growth;
our inability to recruit and retain senior management and other
highly skilled personnel, our ability to raise additional funds
when we need or want them, or at all, to fund our operations; our
limited cash and cash equivalents and recurring losses from our
operations raise significant doubt (or raise substantial doubt as
contemplated by PCAOB standards) regarding our ability to continue
as a going concern; we have previously identified material
weaknesses in our internal controls over financial reporting which
if we fail to properly remediate, could adversely affect our
results of operations, investor confidence in us and the market
price of our ordinary shares; as a foreign private issuer we follow
certain home country corporate governance rules, are not subject to
U.S. proxy rules and are subject to Exchange Act reporting
obligations that, to some extent, are more lenient and less
frequent than those of a U.S. domestic public company; and the
other important factors discussed under the caption “Risk Factors”
in our Annual Report on Form 20-F filed with the U.S. Securities
and Exchange Commission (“SEC”) on March 22, 2023, as such factors
may be updated from time to time in our other filings with the SEC.
Any forward-looking statements contained in this press release
speak only as of the date hereof and accordingly undue reliance
should not be placed on such statements. We disclaim any obligation
or undertaking to update or revise any forward-looking statements
contained in this press release, whether as a result of new
information, future events or otherwise, other than to the extent
required by applicable law.
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version on businesswire.com: https://www.businesswire.com/news/home/20240122076532/en/
Vertical Aerospace Media Lyle Hill
vertical@fleetwoodstrategy.com +44 7919965716
Investor Relations Eduardo Royes
investors@vertical-aerospace.com +1 (646) 200-8871
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