Kleos Space tops up cash reserves with $12.6m to grow satellite constellation

Kleos Space SA (ASX: KSS) has emerged from a trading halt to announce it has received $12.6 million via a share placement to grow its satellite constellation and scale its data-as-a-service (DaaS) offering.

The placement to new and existing sophisticated and institutional investors in Australia and the United States was priced at $0.85 per new CHESS depository interest (CDI), which represents a 9.6% discount to the 30-day volume weighted average trading price.

The placement also includes three attaching options for every five CDIs issued, exercisable at $1.20 and expiring three years from the date of issue.

Kleos chief executive officer Andy Bowyer was pleased to welcome new cornerstone investments from Perennial Value Management and Thorney Investment Group.

“The strong support we have received from new and current investors reflects Kleos’ significant technical and commercial progress that is accelerating rapidly,” he added.

The 14.82 million CDIs to be issued through the placement will rank equally with existing ordinary CDIs of the company. Settlement is expected to occur by the end of the week with allotment anticipated on 15 September.

Kleos said the placement proceeds will be used to fund the launch of future satellite clusters and to scale the company’s geolocation DaaS offering to “build on strong customer demand”.

Cluster development

Kleos aims to continue its constellation expansion with the capital raise expected to fund the development and launch of a fourth satellite cluster.

The first cluster, known as the ‘Scouting Mission’, involves four satellites currently operating and collecting data for customers.

The four satellites in cluster two, the ‘Vigilance Mission’ are in orbit commissioning and are designed to deliver twice the data collection capacity of the Scouting satellites.

In May, Kleos signed a deal with Netherlands-based Innovative Solutions in Space BV (ISISPACE) to build and support a third cluster of four satellites for the ‘Patrol Mission’. These satellites are currently in build for upcoming launch with the SpaceX launch vehicle. They are expected to have twice the payload capacity of the Scouting and Vigilance satellites.

Commercial traction

Kleos also revealed in a business update today that it has more than 170 qualified deals in the pipeline including with 69 government agencies or entities, 26 integrators and analytics tool vendors engaged to include data in their service offerings, 18 resellers across the US, Europe, Japan, Australia and the Middle East and a further 10 resellers in discussions.

Kleos also aims to growth its engineering and customer satisfaction teams in Luxembourg, the United Kingdom and Denver to meet customer needs.