Kromek looks to raise £21m to strengthen balance sheet credibility
Durham-headquartered tech firm Kromek has this morning announced a conditional Firm Placing and Open Offer to raise up to £21m, amid plans to strengthen its reputation to potential international customers.
The radiation detection technology company, which focuses on the medical, security and nuclear markets, disclosed that a perceived lack of balance sheet strength has, at times, weakened its position when negotiating contracts with OEM and government bodies.
The net proceeds of the capital raised will therefore provide the group with the necessary cash reserves to provide comfort to third parties over the group’s balance sheet, whilst also providing working capital to allow the Group to continue to invest in product development to satisfy customer requirements.
The company expects to use £17m to strengthen its balance sheet, whilst £3m would be allocated to general working capital requirements.
Kromek revealed that the Firm Placing of 100,000,000 Ordinary Shares would be available at the Offer Price of 20 pence per Ordinary Share, should the proposal be approved.
Sir Peter Williams, Chairman of Kromek, said he was pleased with the support shown by current shareholders and welcomes new blue-chip institutions to our register.
He explained: “The present fundraising will considerably strengthen our balance sheet, underpinning our plans for the sustained growth of the business and supporting increasing commercial activity through the deployment of our proprietary technology.
’Kromek has made good progress this year, in which we achieved a number of important operational targets, enlarging our customer base and strengthening our relationship with our OEM partners.
“This resulted in significant contract wins over the past 18 months which have given us forward visibility over revenues in excess of 85% of market expectations for the current year.
“The board has great confidence in the future of Kromek and recommends all shareholders to vote in favour of the proposals, which we believe will allow us to deliver increased value to our investors.”