Geelong-based advanced manufacturer Carbon Revolution Limited has entered into a Structured Equity Facility of up to USD 110 million (AUD 171.4 million) with Orion Infrastructure Capital (OIC).
This collaboration aims to integrate 3D printing technology into the production of lightweight carbon fibre wheels for nuclear-powered submarines, potentially reducing lead times for critical components.
The ASX-listed company said this investment complements Carbon Revolution’s pending SPAC merger with Twin Ridge Capital Acquisition Corp, which is set to conclude in October 2023.
With the addition of the OIC investment, the expected capital available for the Twin Ridge merger will reach $230 million, encompassing a previously secured $60 million asset-backed financing from PIUS Limited LLC, along with a $60 million Committed Equity Facility.
This financial boost follows the recent appointment of four US-based senior automotive executives to Carbon Revolution’s board, strengthening the company’s leadership for future growth.
The collaboration with OIC involves the issuance of Class A Preferred Shares and a warrant for up to 19.99 per cent of MergeCo ordinary shares upon closing of the merger, with an initial gross proceeds of $35 million.
Additional proceeds will be made available in tranches based on specific conditions, with the final tranche of $40 million intended for future manufacturing facility development, construction, or retooling.
Jake Dingle, CEO and Managing Director of Carbon Revolution, expressed excitement about the partnership, emphasising OIC’s focus on sustainable transportation efficiency, which aligns with Carbon Revolution’s growth strategy in the rapidly evolving automotive industry.
“The partnership will provide capital to enable Carbon Revolution to capture the accelerating demand for our carbon fibre wheels, as the global automotive industry shifts rapidly to electrification,” Dingle noted.
To date, Carbon Revolution has been awarded multiple programs, including those for electric vehicles (EVs), resulting in a backlog of $680 million.
The financing agreement comes as Carbon Revolution prepares for its merger with Twin Ridge Capital Acquisition Corp, which is expected to result in the company being publicly listed on Nasdaq.
This strategic move positions Carbon Revolution to further penetrate the EV market with its innovative and efficient carbon fibre wheels.
