Shares in Electro Optic Systems Holdings Ltd (ASX: EOS) are rocketing 14% in morning trade following a positive company announcement.
At the time of writing, the defence contractor's shares are swapping hands for $3.14 apiece, up 14.18%.
This means that in the past month, the company's share price has soared more than 50% in value.
SpaceLink receives financial backing
In today's statement, Electro Optic Systems advised that SpaceLink has received conditional finance support from Export Finance Australia (EFA).
Based in the United States, SpaceLink is a wholly-owned Electro Optic Systems subsidiary that specialises in space and communications.
The non-binding letter of support will see up to US$80 million of debt funding for the initial satellite communications constellation (Block-0a) launch.
Late last month, Electro Optic Systems announced an initial funding requirement from US$700 million to US$240 million for Block-0a. This is because the constellation is a lower-cost design solution.
As a result, the latest offer will bring the projected launch date in line with Federal Communications Commission licensing requirements.
The US$80 million support represents one third of SpaceLink's total initial funding requirements for its US$240 million initial Block-0a constellation.
EFA funding is subject to a number of conditions, however. This includes:
- An independent technical review of SpaceLink's feasibility
- A comprehensive funding plan for SpaceLink
- Meeting EFA's eligibility criteria, credit and risk requirements
- Satisfactory ongoing financial and trading performance for Electro Optic Systems
- SpaceLink complying with EFA's environmental and social risk policies
Electro Optic Systems share price snapshot
Despite today's astronomical gains, it has been a difficult 12 months for Electro Optic Systems shares, down 40%.
The company's shares reached a 52-week low of $1.605 early this month, before rebounding over 100% within two weeks.
Electro Optic Systems commands a market capitalisation of roughly $467.83 million.
