Windflow flies a bit longer
Windflow Technology lives to spin another day thanks to an 11th hour financial reprieve.
A day before the latest capital raising was due to close, one of the company’s shareholders has offered to take up any shortfall to the $2 million required to keep Windflow afloat.
The shareholder has also offered to provide a 1.6 million pound loan secured against the first three turbines to be installed for a UK customer. Final agreements have yet to be struck for the supply of the turbines.
A week ago, Windflow founder Geoff Henderson mortgaged his house to provide a $150,000 loan to avert a cash flow crisis.
He has indicated that the value of the company now lies in marketing its intellectual capital after manufacturing was wound down and staff laid off at its turbine manufacturing facility in Christchurch.
Essentially, the company has run out of customers in New Zealand and new consented windfarms are taking too long to come to market.
The company’s unique two-bladed turbines are more suited to smaller windfarms.
“The directors assessed that they require a total of $2 million and/or new cash or commitments from other sources in order for Windflow to carry out its proposed course of action and remain solvent at least through until June 2012, during which time it expects to generate new sources of revenue,” the company said.
The total raised before the new commitment was approximately $1.6 million.