AUCyber (ASX: CYB) announced a renounceable entitlement offer aiming to raise approximately $2.75 million before costs. The offer, managed by Morgans Corporate Limited, allows eligible shareholders in Australia and New Zealand to subscribe for 1 new share for every 3.57 existing shares held at $0.06 per share. This price reflects a 24.5% discount to the 5-day VWAP of $0.080 and a 15.4% discount to the theoretical ex-rights price of $0.071 as of March 24, 2025.
The company intends to use the proceeds for working capital and growth initiatives. Following a board transition in February 2025, a review of cash forecasts indicated the need for additional funding. The board considered available options and determined the entitlement offer as the most viable.
A significant aspect of the offer is the potential increase in 5GN Networks Limited’s voting power. 5GN intends to take up its full entitlement but will not participate in the shortfall. This could result in 5GN holding up to 91.757% of AUCyber’s shares post-offer completion, assuming limited participation from other shareholders. Should 5GN’s holding exceed 90%, it may pursue compulsory acquisition of the remaining shares under the Corporations Act 2001 (Cth).
Eligible shareholders, excluding 5GN, can apply for additional new shares beyond their entitlement under a shortfall offer. Morgans will manage this shortfall, seeking to place any unclaimed entitlements within three months of the offer’s closing date. The entitlement offer is not underwritten.
The indicative timetable includes a record date of March 25, 2025, with the offer closing on April 8, 2025, and new shares expected to commence trading on April 16, 2025. AUCyber reserves the right to alter these dates. The board, led by Chairman Joe Demase, authorized the announcement. It is crucial to note, the company anticipates needing further funding beyond this offer in FY26.
