Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement, this information is now considered to be in the public domain.

17 January 2022

Vela Technologies plc

("Vela" or "the Company")

£750,000 convertible loan note investment in EnSilica

New investment provides Vela's portfolio with exposure to the high growth semiconductor market

The Board of Vela (AIM: VELA), an AIM-quoted investing company focused on early stage and pre-IPO disruptive technology investments, announces that it has invested £750,000 in EnSilica Limited ("EnSilica"), a leading fabless semiconductor design business focused on custom mixed signal Application Specific Integrated Circuits ("ASICs"), in the form of convertible loan notes ("the Loan Notes"), as part of a pre-IPO funding round being undertaken by EnSilica to raise up to £1.5 million.

Further information on EnSilica

EnSilica focuses on the design and supply of custom mixed signal ASICs to system companies and original equipment manufacturers, managing the manufacturing process end-to-end. The fabless mixed signal ASIC supply model is a proven scalable platform to deliver both growth and profitability.

EnSilica has ASICs developed or under development across the satellite communication, automotive, industrial and healthcare markets. Mixed signal and radio frequency ASICs play a key role in differentiating EnSilica's customers' products in these markets.  

The funds raised will enable EnSilica to continue to support its existing client base alongside additional investment in new customer ASICs, the supply of which will support future revenue growth and profitability. The proceeds will also provide working capital to support EnSilica.

Unaudited accounts show that EnSilica generated revenue of £8.4 million and an adjusted EBITDA of £0.8 million in the year ended 31 May 2021; and that at 31 May 2021 EnSilica's net assets were £3.9 million. According to unaudited management accounts, in the six months to 30 November 2021, EnSilica generated revenues of £7.3 million.

Details of the Loan Notes

Vela has entered into an agreement with EnSilica, by which it has subscribed for £750,000 of unsecured interest-bearing convertible loan notes in EnSilica. Vela's investment has been satisfied from the Company's existing cash resources. The key terms of the Loan Notes are as follows:

·      interest accrues on the Loan Notes at a rate of 10 per cent. per annum;

·      the Loan Notes will be repayable on 9 January 2023 ("the Repayment Date") to the extent not previously repaid or converted;

·      interest will accrue and be paid on the Repayment Date;

·      the Loan Notes will automatically convert on an IPO of EnSilica into new ordinary shares in EnSilica at a 12% discount to the price at which such shares are subscribed in the IPO; and

·      the Loan Notes are transferable only with the prior consent of EnSilica.

James Normand, Executive Director of Vela, commented:

"EnSilica perfectly fits Vela's criteria for investment.  Its specialist expertise in the semiconductor field and in particular in Application Specific Integrated Circuits puts EnSilica firmly in the 'disruptive technology' space.  Moreover, a public listing for its shares, which EnSilica expects to achieve in the first half of this year, and the terms attaching to Vela's investment are attractive and provide the potential for meaningful gains for Vela as EnSilica puts its expansion plans into effect."

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About Vela Technologies 

Vela Technologies plc (AIM: VELA) is an investing company focused on early stage and pre-IPO long term disruptive technology investments. Vela's investee companies have either developed ways of utilising technology or are developing technology with a view to disrupting the businesses or sector in which they operate. Vela Technologies will also invest in already-listed companies where valuations offer additional opportunities.