UPDATE JULY 19: Sky and Space Global announces another extension of its request to suspend trading of its shares pending the nomination of two Australian-resident directors and associated financing, this time to “no later than the commencement of trade on 15 August.”
UPATE July 1: Sky and Space Global (SAS) said it still had not selected two Australian-resident non-executive directors, a condition of resuming trading on the Australian Securities Exchange (ASX) and raising new funds, as of July 1 and requested that its voluntary suspension of share trading continue. The company said it expects the suspension to end “no later than July 22.”
SAS said it is making “considerable progress with completing its financing arrangements” and the search for two directors.
UPDATE May 28: Sky and Space Global (SAS) requested that its voluntary suspension of trading on ASX remain in place until it finds two Australian-resident non-executive directors, as per ASX requirements, and secures financing. The company said it expects to make an announcement, and to resume trading, by July 1.
UPDATE May 13: Sky and Space Global (SAS) said it has contracted with satellite manufacturer GomSpace to provide, pending financing within 30 days, eight 6u cubesats for SAS’s Global Coverage constellation, to supplement the Pearls constellation by extending geographic coverage. The contract’s value is 5.2 million euros ($5.8 million) for the eight satellites, with an option for a second batch of eight satellites for 3.8 million euros.
SAS is still looking for two Australian-resident directors, which will enable the company to end suspension of its listing ont the Australian Securities Exchange (ASX) and pursue a capital raise.
UPDATE April 18: Sky and Space Global said it expects to be in compliance with the ASX trading rule requiring two board members to be residents of Australia by May 3, at which time it will resume trading and pursue its Tranche 2 and Priority Offer of shares to raise 7.4 million Australian dollars.
PARIS — Startup M2M/IoT constellation operator Sky and Space Global (SAS) said it has enough cash to operate for just two more months and is counting on a new share issue to buy it more time.
The share offer has been complicated by the resignation of two board members, an event that has removed SAS from the Australian Securities Exchange (ASX) until it finds replacements who are Australian residents.
In another blow, the lead manager for the share offer, Taylor Collison Limited; and corporate advisor Chieftain Securities Pty Ltd., have cancelled their agreement to underwrite a combined 3 million Australian dollars ($2.11) of SAS’s Priority Offer.
Both will continue in their respective roles as lead manager and corporate advisor.
SAS on April 16 issued a Supplemental Prospectus for its share offering to reflect the most recent negotiations with satellite builder GomSpace of Denmark. GomSpace and SAS have set a mid-May deadline for the agreement to convert to a binding contract.
Under the new agreement, GomSpace will begin work on a second constellation of 6U-size cubesats in inclined orbit to provide broader geographic coverage than what is offered by the 3U Pearls constellation of 200 satellites, in equatorial orbit:
This new constellation of eight satellites would be built while work on the original, 200-satellite network was continuing at GomSpace.
In its Supplemental Prospectus, SAS said its latest trading halt on the ASX, on April 4, is likely to continue until it conforms to ASX rules requiring that at least two board members living in Australia.
The resignation of board members Michael Malone and Di Fulton was announced April 9. SAS said it has begun the search for replacements, and that their resignation “has no implications on its business plan for the launch of the first batch of operational satellites by early 2020.”
The company did not explain why Taylor Collison and Chieftain Securities withdrew their underwriting support. Brett Mitchell, a former SAS director, owns 33% of Chieftain’s equity.
SAS announced in February its plan to raise 12 million Australian dollars in new equity, in two tranches. The first, valued at 7.8 million Australian dollars, was completed. The second was supposed to occur in April.
Given the restructured GomSpace agreement, the withdrawal of underwriting support from the lead manager and the resignation of two board members, SAS has offered shareholders who have already subscribed the opportunity to withdrawal their investment in the Priority Offer and Tranche 2 Offer, with a deadline of May 16. The Priority Offer offer will go forward, but will no longer have a minimum subscription rate given the Taylor Collison/Chieftain withdrawal.
SAS’s ongoing operating expenses are about 500,000 Australian dollars per month. It said it will need to raise at least 90% of the 7.2 million Australian dollars offered under the Tranche 2 placement of 4.2 million Australian dollars and the Priority Offer of 3 million Australian dollars.
If it fails to reach the 90% subscription rate, it will need to seek alternative financing almost immediately.