Tern has successfully negotiated a new funding facility with an investor to provide up to £3m, available for up to 36 months, with an initial £0.5m drawn down. The credit facility is intended to protect Tern’s commercial position by supporting further growth and investment in its current portfolio companies. The facility will also strengthen Tern’s negotiating position and moves the company closer to a self-financing model. Progressive Research see this funding as a sensible move as Tern continues to mature its position and offering. Tern also hosted a Q&A session with Board members Al Sisto and Ian Ritchie, and they reiterate some of the key messages discussed.
New funding structure
Draw down amounts can be repaid either in cash, using proceeds of a full or partial exit of one of its portfolio companies, or alternatively via conversion rights and the issue of new ordinary shares. However, the investor retains the option for the first 10 days following a non-cash payment for the drawdown to be satisfied through the sale of Wyld shares, from the Wyld Escrow facility. The investor will receive warrants equal to 50% of each drawdown. Following the initial advance, the investor received warrants with an exercise price of 6.79p (a 6% premium to the FY22 NAV of 6.4p);if exercised this would raise £375k.
Tern plc (LON:TERN) backs exciting, high growth IoT innovators in Europe. They provide support and create a genuinely collaborative environment for talented, well-motivated teams. Wyld Networks is uniquely placed to deliver fixed and mobile mesh technology for Smart Cities, Events, Retail, Health and Industrial installations.