The FBR Ltd (ASX: FBR) share price has returned from its trading halt with a thud.
In morning trade, the ASX robotics stock is down 19% to 3.9 cents.
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Why is this ASX robotics stock crashing?
Investors have been hitting the sell button today after the company announced the completion of an institutional placement.
According to the release, the placement will raise approximately $12.5 million before costs through the issue of approximately 328.9 million shares.
These funds are being raised at a price of 3.8 cents per new share, which is 20.8% discount to where its shares last traded.
Management notes that the placement received strong support from new and existing institutional and sophisticated investors both at home and offshore.
Why is it raising funds?
The release advised that the funds raised from the placement will be used to provide additional working capital to deliver a number of key upcoming milestones.
This includes the 10 home Demonstration Program to be undertaken in the United States, which it notes could lead to the potential exercise of the US joint venture option with CRH Ventures.
If this is exercised, it would trigger a purchase order for 20 Hadrian X robots and CRH Ventures Americas providing a US$40 million debt facility to the Fastbrick Americas joint venture.
The ASX robotics stock's managing director and CEO, Mike Pivac, believes that this placement comes at a pivotal juncture for the company. He said:
The Company is at a pivotal juncture, having deployed the first of its world-leading Next-Generation Hadrian X robots to Florida and preparing to undertake the Site Acceptance Test, the first of many upcoming milestones, it is pleasing to have completed a strongly supported capital raise that positions the Company well ahead of exciting months ahead. The support from our existing institutional shareholder base and the new shareholders joining the register is appreciated and I look forward to providing further updates as we take our Company to the next-phase in its evolution.
Despite today's decline, the FBR share price remains up almost 100% since this time last year.
Excitement around its expansion into United States market appears to be largely behind this move.
As we covered here, its joint venture is aiming to offer Wall as a Service using Hadrian X construction robots in the United States. The joint venture aims to purchase 20 Hadrian X units at US$2 million each initially and then sees a pathway to take the total to 300 units in the future.
