Creotech Instruments Secures Nearly PLN 60m in Series J Shares Offering

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Creotech Instruments, a Polish manufacturer of satellites, and satellite systems and components, has successfully raised approximately PLN 60 million through a public offering of its Series J ordinary bearer shares.  Investors subscribed to all 396,557 shares on offer at PLN 150.00 per share. These proceeds are earmarked for investments aiming to position Creotech Instruments as a leading supplier of microsatellite technologies within the European Union. In the coming years, the company plans strategic investments in three pivotal areas: broadening the product portfolio, scaling up production capabilities, and expanding the sales division. Throughout this process, the company will be advised by cc group, its regular IR and financial advisor, with Pekao Investment Banking S.A., Trigon Dom Maklerski S.A. and Bank Polska Kasa Opieki S.A. – Biuro Maklerskie Pekao serving as offer managers.

Creotech Instruments’ public offering entailed 396,557 Series J ordinary bearer shares, which, subsequent to a successful book-building process, subscription by investors and registration of increased share capital, will represent a 16.67 percent stake in the company. The public offering of shares was addressed to investors selected by the Company’s Management Board, in accordance with the provisions of the issue resolution adopted by the Extraordinary General Meeting of the Company.

“Our business model, anchored in two promising sectors – space and quantum – enabled the successful conclusion of the Series J Shares offering, with a demand that covered all shares available. The price obtained was nearly 50% above the previous public offering in 2022 when the company was transitioning to the Warsaw Stock Exchange’s main market. This means that we have raised approximately PLN 60 million gross, which we intend to allocate to all planned investments that will accelerate our growth trajectory and, above all, elevate us to the position of a leading supplier of microsatellite technologies in the European Union in defense and commercial projects,” said Grzegorz Brona, PhD, President of the Management Board (CEO) of Creotech Instruments S.A.

The investments are projected to be financed through the proceeds from the Series J Shares issue, approximately allocating 60%-70% towards product portfolio expansion, 15%-25% towards enhancing production capacity, and 15%-20% towards sales department reinforcement. These proportions are only tentative and may be subject to changes in the future depending on the situation in the sector, the macroeconomic environment, contracts secured by the company, the project schedule and other factors.

“Our development is also accelerated by significant contracts signed and initiated this year, holding strategic importance for national and European defense. Our selection for the State Treasury’s Armament Agency project and the REACTS project for the European Defense Fund alongside space corporations of considerable magnitude such as DLR, OHB, and Airbus, serves as a formidable reference – one we are already leveraging in our business negotiations with the European Space Agency and the European Commission. The total value of prospective projects under discussion is estimated to potentially reach approximately EUR 300 million in the upcoming years. It is vital to note that, in addition to the space segment, our quantum segment also offers promising growth prospects, and we are already building Creotech’s expert position to handle key, large European orders in the future,” adds Grzegorz Brona.

In July, the company unveiled its strategy for financing space projects. The strategy assumes a series of investments in the coming years in three key areas, aiming to achieve a dominant position as a supplier of microsatellite technologies in the European Union for defense and commercial projects. The first area is the expansion of the product portfolio, including: scaling the proprietary HyperSat platform to 200 kg. This move will allow the company to enter the most promising segment of the satellite market, specifically microsatellites (10-100 kg) and minisatellites (100-500 kg). The second priority is the expansion of production capacity, including retrofitting production facilities and upgrading laboratory facilities, in response to the growing demand for the company’s solutions. Lastly, the company will bolster its sales and marketing efforts, planning to at least double the size of this team and establish dedicated product and after-sales support departments.

Creotech Instruments’ current development positions it to initiate first major projects at the national level, especially catering to public and defense needs. This includes the involvement in phases 0 and A of the State Treasury’s Armament Agency project and the company’s leadership at the European scale, particularly in the REACTS project, where they synchronize efforts of prominent players like Airbus France and OHB within the segment.

In July 2023, Poland made a strategic move to increase its national contribution to the ESA budget by an additional EUR 295m in 2023-2025. This national contribution mechanism to ESA allows for almost full recuperation of the invested funds through projects and orders from ESA directed towards domestic enterprises.  Over the past decade, Creotech has successfully executed more than 25 space projects in conjunction with ESA, thus becoming one of the largest Polish contractors and the first choice in Central Europe for key Agency projects. Currently, the company is in discussions with ESA regarding four different space missions, all based on its proprietary HyperSat microsatellite platform.

Legal disclaimers

This press release is for information purposes only and is in no way intended to, whether directly or indirectly, promote the offer, issue or subscription of Series J Shares, nor constitutes promotional material or advertisement under Article 22 of Regulation (EU) 2017/1129 (the “Prospectus Regulation”). It has not been prepared or published by the Company with the intention of promoting Series J Shares or their subscription or for the purpose of encouraging investors, whether directly or indirectly, to take up the shares. No prior materials aiming to promote Series J Shares or their subscription have been published by the Company.

This press release is neither a prospectus nor any form of memorandum, information, or offer document. No prospectus, in relation to the content of this press release, will be made available, and its preparation is not required under the Prospectus Regulation. This press release does not constitute an offer for the sale or taking up of securities, an invitation for offers to purchase securities, or an encouragement/recommendation to buy securities, including it is not an investment recommendation within the meaning of the Market Abuse Regulation (Regulation (EU) No 596/2014) and Commission Delegated Regulation (EU) 2016/958 of 9 supplementing the Market Abuse Regulation, nor should it form the basis for any decision to purchase the Company’s securities.

Series J Shares have not been and will not be the subject of registration, approval or notification in accordance with the provisions of the Prospectus Regulation or American Securities Act of 1933 as amended (the “US Securities Act”) and cannot be offered or sold outside the Republic of Poland (including in other European Union member states and the United States of America), unless such an offer or sale could be made in a given state lawfully, without the need to meet any additional legal requirements by the Company and its advisors. Every investor domiciled or established outside the Republic of Poland should become familiar with the relevant provisions of Polish law and the provisions of the laws of other countries that may apply to them in this respect.

This press release is not intended to be distributed or used by any person or entity in any jurisdiction where such dissemination or use would be in conflict with local laws or regulations, or which would subject the Company to any registration, authorization, notification, or other licensing requirements under applicable regulations. The dissemination of this press release and other related information may be restricted by law. Persons who come into possession of any documents or other information referred to in this press release should inform themselves about and comply with such restrictions. Failure to comply may constitute a violation of the securities laws of a given jurisdiction. Distributing this press release may be illegal in some jurisdictions.

THIS PRESS RELEASE IS NOT INTENDED FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS AND THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA, JAPAN, OR SOUTH AFRICA, OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE LAWS OF THAT JURISDICTION. SUBJECT TO CERTAIN EXCEPTIONS, THE SHARES OF THE COMPANY MAY NOT BE OFFERED OR SOLD IN SUCH JURISDICTIONS, OR TO OR FOR THE BENEFIT OF NATIONALS OF THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA, OR PERSONS DOMICILED OR ESTABLISHED IN THESE COUNTRIES.

This press release is not an invitation to underwrite, subscribe for or otherwise acquire or dispose of any securities in any jurisdiction. This press release is not a recommendation regarding an investment decision regarding the Series J Shares offering. Every investor or prospective investor should conduct their own research, analysis and assessment of the activities and data described in this press release and publicly available information. The price and value of securities can rise as well as fall. Past performance is not indicative of future results.