Electric scooter manufacturer Vmoto Ltd's (ASX: VMT) share price leapt out of the starting gate today after announcing it had received firm commitments for an equity capital raising of approximately $9.6 million. The Vmoto share price had been in a trading halt since Monday 10 August ahead of this announcement.
The company announced its placement received strong demand from strategic investors, institutions and other professional investors. That included existing shareholders, cornerstoned by Perennial Value Management.
Vmoto led the placement without the appointment of lead managers.
The company will issue 21,411,408 fully paid ordinary shares for 45 cents per share, a 7.4% discount to the volume weighted average price for the last ten trading days prior to its trading halt.
Vmoto expects to issue the new shares on 19 August 2020 with trading commencing on ASX on the same day.
The ASX's only two-wheeled electric vehicle manufacturer will use the proceeds to increase its international market initiatives and accelerate potential opportunities in the growing B2C and B2B electric two-wheel vehicle markets internationally.
What the Directors said
Vmoto Managing Director, Mr Charles Chen said:
"Recent operational and commercial successes during the current global pandemic highlight that the company has reached an inflection point in its growth. As a result, it was approached by several strategic funds and took decisive action to further strengthen its balance sheet, ensuring it is in as strong a position as possible to capitalise on this success and accelerate its growth going forward.
As a result of the Placement and the additional capital raised, Vmoto is now in an even stronger position for all its shareholders, and very well placed to accelerate its growth and expand its strategy to drive long-term value for investors. We would like to thank all investors who participated in the placement".
Andrew Smith, Head of Smaller Companies & Micro Caps at Perennial Value Management said:
"We have been monitoring the progress of Vmoto for several years and have seen the company deliver consistent growth in sales. Changes in legislation and the introduction of government schemes has given rise to an increasing trend of consumer preference for lower cost and convenient transport via two-wheel electric vehicles which has been accelerated by COVID-19 – Vmoto's most recent quarterly sales is a testament to this".
Vmoto share price soaring on strong sales growth
Vmoto's sales have seen strong growth over the last 12 months, buoyed by the fast-growing demand for e-scooters. The company is also seeing higher demand from parcel delivery companies, further spurred by COVID-19 lockdown measures.
Last week, Vmoto reported record quarterly sales of 6,389 units in the three months to the end of June. That's an increase of 55% on the previous quarter and more than double the sales in the same quarter of 2019.
Including today's 15.4% increase, the Vmoto share price is up 150% year to date. Since its 23 March low, the Vmoto share price has soared more than 360%.
