Hybrid Air Vehicles – the British company behind the Airlander hybrid aircraft, the world’s longest aircraft –is looking to raise £50m through a float on AIM, the London Stock Exchange’s junior market. While there is no confirmation for the exact float date, the company has mentioned it will likely be at the end of 2017 or the start of 2018.
Formed in 2007, the company has successfully delivered a number of prototype vehicles and in 2009 it, alongside Northrop Grummann (NGC), won a $500m US Army contract to develop a Long Endurance Multi-intelligence Vehicle (LEMV), which was delivered between 2009 and early 2013.
Funding and company valuation
Hybrid Air Vehicles has previously raised capital from a plethora of sources including ultra-high-net-worth individuals, UK and EU government grants and crowdfunding. The company initially raised £2.1m through equity-based crowdfunding and completed a second raise of £1.2m a year later.
It is widely agreed that the company will seek to raise up to £30m through the float and will also aim to raise a similar level through debt financing. It's presently looking for an adviser for the AIM float. Given that the last crowdfunding round valued Hybrid Air Vehicles at £55m, it will be interesting to see how the broker, and then the markets value a company whose second test flight of it’s flagship aircraft famously crashed.
THE SECRET GUIDE TO IPOs
Download your copy of the guide today
Has the crash clipped its wings?
Despite the setback, it is easy to see potential in the Airlander, which can function as both passenger ship and cargo ship. The Airlander 50 is predicted to have a 50 tonne payload and will cost a fraction of the similar-sized payload cargo planes, such as the Boeing 747 cargo plane. The upfront cost of the plane is roughly $400m, while the Airlander is expected to retail for around £25m.
Yes, the Boeing can travel much faster; the Airlander presently has a top speed of around 100 miles per hour, while the Boeing can travel close to 600 miles per hour. However, the Boeing has a restricted range and requires a full-length airstrip to be able to land. The Airlander is expected to be able to travel around the world twice without refueling and can take off or set down from a large open field, no airport required.
It is easy to see why the Chinese Government have been in touch with Hybrid Air Vehicles about a potential bulk order. The Airlander is cheaper to purchase and maintain, less polluting and can be used to transport resources required for the building of infrastructure-based projects to remote locations. This may just be the x factor that makes Airlander a tasty acquisition; early reports claim a number of aerospace companies are already considering an offer.