ActivePort Launches Fully Underwritten $2.5M Entitlement Offer with Options, Diluting Non-Participants
ActivePort Group Ltd has announced a fully underwritten entitlement offer to raise approximately $2.5 million, issuing new shares and options to existing shareholders and underwriters. The capital raise aims to fund business growth and repay loans but will dilute non-participating shareholders significantly.
- Non-renounceable entitlement issue of 1 share per 2.75 held at $0.01 each
- Issuance of 1 free new option for every 2 shares subscribed
- Fully underwritten by Alpine Capital and GBA Capital with sub-underwriting by MWP Partners
- Offer proceeds allocated to business development, product development, loan repayment, and corporate expenses
- Potential dilution of up to 45.87% for non-participating shareholders on a fully diluted basis
Capital Raise Details
ActivePort Group Ltd (ASX, ATV), a technology company specialising in software and IT services, has launched a fully underwritten pro-rata entitlement offer to raise up to $2.5 million. The offer allows eligible shareholders to subscribe for 1 new share for every 2.75 shares held at a price of $0.01 per share. Additionally, shareholders will receive 1 free new option for every 2 shares subscribed, exercisable at $0.02 on or before 30 November 2028.
The offer is fully underwritten by Alpine Capital Pty Ltd and GBA Capital Pty Ltd, with sub-underwriting support from MWP Partners Limited, the company's largest shareholder. The underwriting arrangement provides certainty of funds but also introduces potential shifts in shareholding control.
Use of Funds and Strategic Intent
Proceeds from the entitlement offer will be directed towards key areas including business development (20%), product development (21%), delivery and support (16%), loan repayment (27%), and corporate and administrative expenses (8%). The company aims to strengthen its working capital position and support ongoing growth initiatives, particularly in expanding its software offerings for telecommunications and global edge computing sectors.
ActivePort’s board believes the capital raise will provide sufficient working capital to meet its current operational objectives. However, the company acknowledges that further funding may be required depending on business performance and market conditions.
Impact on Shareholders and Control
Shareholders who do not participate in the offer face dilution of approximately 26.67% on their shareholding. When factoring in the potential exercise of new options, dilution could reach nearly 45.87%. MWP Partners Limited, currently holding 17.65% of shares, may increase its stake to 23.62% if it fully subscribes to its entitlement and sub-underwriting commitments, potentially influencing company decisions requiring special resolutions.
The offer is non-renounceable, meaning shareholders cannot sell or transfer their entitlement rights, which may affect liquidity and participation rates. The company has emphasized the speculative nature of the investment and the risks associated with dilution and control changes.
Risks and Market Context
ActivePort highlights a range of risks including operational dependencies on long-term contracts, technological competition, cybersecurity threats, and the need to attract and retain key personnel. The company also notes macroeconomic and geopolitical uncertainties, including ongoing global conflicts, which may impact market conditions and investor sentiment.
The directors caution that the offer’s success and the company’s future performance are subject to many variables beyond their control. No earnings forecasts are provided due to inherent operational uncertainties.
Next Steps and Market Implications
The entitlement offer opens on 4 August 2025 and closes on 25 August 2025, with securities expected to commence trading on ASX from 1 September 2025. Shareholders and investors will be closely watching subscription levels and the outcome of shareholder approval for the issuance of options to underwriters, which will shape the company’s capital structure and strategic flexibility going forward.
Bottom Line?
ActivePort’s fully underwritten entitlement offer secures near-term funding but raises questions about shareholder dilution and control shifts as the company pursues growth.
Questions in the middle?
- Will shareholder participation meet the full underwriting commitment, or will underwriters increase their holdings?
- How will MWP Partners’ potential increased stake influence ActivePort’s strategic decisions?
- What are the company’s plans if additional funding beyond this raise becomes necessary?