Vertical Aerospace has closed its latest round of fundraising, generating more than the $75 million target set when shareholders approved a new public offering backed by its main creditor, Mudrick Capital. Late on January 24, the UK eVTOL aircraft developer announced that the round raised $90 million, before deducting underwriting costs and other expenses of around $6 million.

In addition to $25 million from Mudrick Capital, the new capital includes more than $60 million from new investors. On November 25, Mudrick agreed to make the upfront payment of $25 million and also provide a $25 million backstop to cover any shortfall in funding. The refinancing package involved converting $130 million of debt into equity.

Involved in the offering was the sale of 15 million units of equity at a unit price of $6. Each unit comprises one ordinary share, plus one half of a Tranche A warrant and one half of a Tranche B warrant. According to Vertical, exercising the warrants could generate additional proceeds of approximately $101 million.

Under the pricing arrangements announced in a Securities and Exchange Commission filing on January 23, the Tranche A warrants will expire after five years as long as the company achieves two conditions. The first of these is to demonstrate wingborne flight with its VX4 eVTOL prototype. Once that is achieved, the 10-day volume weighted average price of the company’s ordinary shares has to be equal to or greater than 103% of the exercise of the warrants.

The Tranche B warrants, exercisable at a price of $7.50 per whole ordinary share, also expire five years from the date of issuance. Vertical’s ordinary shares trade on the New York Stock Exchange and, following a one-for-ten stock split in September 2024, trading on January 24 closed at $5.65.

"Real-world" Flight Tests in 2025

According to Vertical, in addition to achieving piloted wingborne and transition flights with a full-scale prototype, it is aiming to meet the following targets in 2025: build and fly its third full-scale prototype; demonstrate “real-world use cases;” earn additional design organization approval privileges from the UK Civil Aviation Authority, including flight conditions privileges; and start production of certification-conforming aircraft and long-range parts purchasing. Under its Flightpath 2030 strategy, the Bristol-based company is aiming to achieve type certification for the four-passenger aircraft in 2028.

“Strong investor demand and the success of this upsized public offering are indicators of investors’ confidence in Vertical’s vision and our ability to lead the eVTOL sector by the end of the decade,” said Dómhnal Slattery, the former aircraft leasing industry executive who was appointed the company’s chairman last week. “Securing access to capital is critical to our success, and I want to extend my gratitude to Jason Mudrick for his pivotal initial investment, which set the stage for this funding round and inspired others to join us on this transformative journey.”

Vertical reported that as of Dec. 31, 2024, it held £22.5 million (about $28 million) in cash and cash equivalents. The company will release its 2024 year-end financial results on March 11.