X2M Connect (ASX: X2M) has garnered substantial backing for a $4.9 million share placement and entitlement offer. This capital injection aims to fortify the company’s balance sheet, decrease its debt burden, and strategically position it for upcoming market opportunities. X2M Connect has developed and commercialised an Internet of Things (IoT) solution, delivering productivity improvements, cost savings and improved public safety to enterprise and government clients in the utilities sector. The technology connects utility meters and other sensors to the internet, enabling data exchange and remote control of these devices.
The placement involved approximately 200 million shares issued to institutional and sophisticated investors at $0.013 per share, marking a 28% discount relative to X2M’s last closing price. Furthermore, X2M will issue an additional 174 million shares via an entitlement offer to existing shareholders at the same price. This offer is structured as two new shares for every five currently held, with participants also receiving one free unlisted option for each new share. These options have an exercise price of $0.016 and will expire in December 2027.
The proceeds from the capital raising will primarily be used to significantly reduce X2M’s debt. Additional funds will be allocated to foster business momentum and pursue market opportunities within renewable energy, artificial intelligence, and public safety applications. Cygnet Capital served as the lead manager for the raising, with X2M anticipating finalisation in August.
Mohan Jesudason, Chief Executive Officer of X2M, noted that the support received reflects investor confidence in the company’s strategic direction. He stated that the placement would eliminate the majority of their debt, bolster their balance sheet, and enable accelerated expansion in Asian and Middle Eastern markets. X2M has secured new mandates exceeding $5.5 million and is pursuing renewable energy AI solutions in Taiwan, along with expanding its public safety vertical in South Korea.
