DUG Technology has announced it will raise $35.2 million, as the company aims to further accelerate its growth trajectory.
Matt Lamont-led DUG, a high-performance computing firm, has identified three key growth opportunities in which the proceeds will be allocated: data centre infrastructure for its Elastic MP-FWI projects, Middle East expansion, along with bringing its DUG Nomad modular data centre into production.
There are three components to the capital raise – institutional placement, conditional placement and share purchase plan, although the issue price will be identical.
Under the non-underwritten institutional placement, West Perth-based DUG told the market it would issue 15.8 million new fully paid ordinary shares to raise $30 million, at an issue price of $1.90 per share.
This price represents a 12.8 per cent discount to DUG’s closing price of $2.18 on October 15, prior to entering a trading halt, along with a 15.3 per cent discount to the 10-day volume weighted average price.
Along with the placement, the company will also offer a share purchase plan, in order to raise up to $5 million.
Subject to shareholder approval, DUG’s board of directors will also have an opportunity to participate in a conditional placement to generate a further $200,000.
“This raise represents a pivotal point in DUG’s growth journey, with the proceeds enabling us to invest in exciting growth opportunities,” Mr Lamont said.
“We have a robust outlook for the business, with the pipeline now the largest it has ever been.”
DUG’s plan to expand its presence into the Middle East was announced in May, with Mr Lamont stating the reason for the move was based on success in the United Arab Emirates.
In August, the company’s share price spiked following the release of its 2024 financial year results, which resulted in revenue climbing by 29 per cent to $US67.4 million, or $100.4 million.
DUG’s profit did regress by 33 per cent to $US3.3 million, with the company citing costs of a third-party compute having not been incurred during the 2023 financial year.
Seven days later, DUG also confirmed that chief financial officer Ajesh Raithatha had left the company by mutual consent, with chief operating officer Daniel Lamont appointed acting CFO while a full-time replacement is found.
As of 10.04am WST, DUG shares were down 11 per cent to $1.95.
