Swoop Holdings launches a $10 million entitlement offer to fund its Melbourne Fibre Project, while initiating a board renewal following shareholder feedback and upcoming EGM challenges.
- Partially underwritten $10 million entitlement offer at $0.10 per share
- Directors and senior management committed $1.9 million and sub-underwriting $4 million
- Funds targeted for Melbourne Fibre Project capex and working capital
- Board renewal underway with Chair stepping down and new directors sought
- Major shareholder resolutions expected to be defeated at upcoming EGM
Capital Raise to Fuel Strategic Growth
Swoop Holdings Limited (ASX – SWP) has announced a partially underwritten accelerated entitlement offer aiming to raise up to $10 million at an offer price of $0.10 per new share. This capital injection is earmarked primarily to support the construction and delivery of the Melbourne Fibre Project, a cornerstone of Swoop’s revised strategic focus. The offer is structured as a 1 for 2.14 entitlement, providing existing shareholders the opportunity to maintain their stake at a significant discount to recent trading prices.
Directors and senior management have demonstrated confidence in the company’s prospects by committing $1.9 million to the offer and sub-underwriting an additional $4 million, underscoring their ongoing commitment as significant shareholders. The funds raised will also bolster working capital, ensuring operational flexibility as the company advances its infrastructure ambitions.
Strategic Focus and Business Simplification
Swoop’s refreshed strategy, branded “Focus. Divest. Grow,” aims to streamline operations and sharpen returns by concentrating on three core product areas – mobile services through its award-winning virtual network operator, a rapidly scaling nbn platform targeting value-conscious households, and the fibre opportunity centered on a high-security, approximately 300-kilometre network under construction in Melbourne. This fibre network targets hyperscale data centre operators and enterprise customers, with additional monetisation potential via access to residential greenfield corridors.
CEO Alex West highlighted that the capital raise is pivotal for accelerating the Melbourne Fibre Project, which represents a significant growth avenue for the company. The strategy reflects a disciplined approach to execution, responding directly to shareholder feedback and market dynamics.
Governance Changes and Board Renewal
In response to shareholder input, Swoop has initiated a board renewal process. James Spenceley stepped down as Chair following the recent AGM but remains on the board as an independent non-executive director. Paul Reid has been appointed interim Chair while the company searches for two new independent non-executive directors, including a new Chair and an Audit & Risk Committee Chair, with expertise in telecommunications, governance, and audit. The goal is to have these appointments finalized by March 31, 2026.
This governance refresh comes amid an extraordinary general meeting (EGM) convened by a significant shareholder group proposing director appointments and removals. However, Swoop has received indications that shareholders holding over 50% of issued shares intend to vote against these resolutions, suggesting the current board’s composition will remain intact for now.
Entitlement Offer Details and Market Implications
The entitlement offer comprises an institutional component expected to raise $2.8 million and a retail component targeting up to $7.2 million. The offer price represents a 25.4% discount to the theoretical ex-rights price and a 33.3% discount to the last closing price, reflecting a strategic pricing to encourage participation. New shares issued will rank equally with existing shares, and any shortfall will be placed with institutional investors within three months post-offer closure.
Shareholders who do not take up their entitlements will see those rights lapse without value, emphasizing the importance of participation for maintaining ownership levels. The retail offer opens on December 10, 2025, and closes on December 19, 2025, with results announced shortly thereafter.
Overall, this capital raising and board renewal signal Swoop’s intent to solidify its position as a challenger in Australia’s telecommunications landscape, leveraging infrastructure investments and governance improvements to drive future growth.
Bottom Line?
Swoop’s $10 million raise and board refresh set the stage for a critical growth phase, but execution and shareholder alignment remain key watchpoints.
Questions in the middle?
- Will the retail entitlement offer achieve full subscription given the significant discount?
- How quickly can the new board members be appointed and influence strategic direction?
- What are the potential impacts if the Melbourne Fibre Project faces construction or customer pipeline delays?