Oil and gas technology firm Plexus Holdings is to tap investors for £6 million to bolster its balance sheet amid the current industry “down cycle”.
The Aberdeen-based firm said it has agreed the terms of placing to new and existing shareholders at 65p a share – a slight discount to Friday’s closing share price of 67.25p.
“The placing is intended to strengthen Plexus’ balance sheet during the current down cycle and to provide Plexus with the flexibility to support the capital requirements of its long term strategy of becoming a leading international oil and gas services company, supplying a new and superior standard of wellhead equipment and associated products for exploration, production and subsea applications,” the Aim-quoted company said.
Plexus, which develops wellheads aimed at preventing the type of blowout behind the 2010 Gulf of Mexico disaster, added that the proceeds from the placing would be used to pursue opportunities in new regions including the Americas, Asia and Russia, and to boost its research and development spending with an eye on the decommissioning market.
Shareholders will be asked to approve the fundraising at a general meeting to be held on 28 June, with trading in the new shares set to begin the following day.
Chief executive Ben van Bilderbeek, who has agreed to invest £200,000 in the placing by subscribing for 307,693 shares, said the fundraising “will ensure that we will be able to continue to invest in our proprietary technology and products during the current oil and gas down cycle, and at the same time support our new partners in overseas markets such as Russia”.
He added: “Needless to say, we are keen to be in a position to hit the ground running once activity in the sector picks up.”
Plexus warned earlier this year that its full-year results would be “significantly” below City hopes, and has almost halved its headcount to 80 as it seeks to cut its payroll costs.