Christchurch-based technology incubator Powerhouse Ventures will not proceed with plans to sell a quarter of its Invert Robotics' holding for $1.3 million as one of the sale conditions has not been satisfied.
In September, Powerhouse said it had been approached during Invert's current financing round and announced plans to sell, stating the sale would result in a profit above its current book value of Invert. It owns 34.6% of the company and the sale would have reduced that to between 23.6% and 28.2% of the shares.
The deal was conditional on completing a pre-emptive shareholder process and co-sale rights under the shareholder agreement it has with Invert. "Whilst Powerhouse agreed to the now-cancelled transaction, we are more than happy to maintain our higher holding stake in Invert," Powerhouse said.
According to Powerhouse, the potential buyer will now invest directly in Invert's current capital raise to ensure it achieves its required holding level of Invert shares. Invert is undertaking an initial capital raise of A$4 million, which is proceeding "terribly well," said Powerhouse chief executive Paul Viney. The book is expected to be closed in a week or two. He declined to name the potential buyer.
Invert will subsequently look to raise around a further $A6 million to "enable M&A expansion throughout Europe," he said. The second part will take place over the next 12 months, according to Mr Viney.
Invert Robotics has developed a novel climbing robot system for remote inspection services in the dairy and food processing sectors as well as the aviation industry. According to Powerhouse, it has an enterprise value of $10.7 million and seven employees.
Powerhouse shares recently traded at 35Ac on the ASX and have more than halved this year.
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