Seraphim Space, the London-listed investment company focused on commercial space technology, has announced plans to raise up to £350 million to capitalise on a booming space market.
The company said the fundraising, one of the largest ever by a UK‑listed investment trust, was to take advantage of a “critical inflection point”.
“Recent developments have caused a significant cost reduction in access to space, with lower satellite and launch costs — there are few parts of the global economy that will be unaffected by space,” the company said.
“SpaceTech’s accelerating growth is being driven by global security concerns, desire for climate sustainability and the search for the next generation of infrastructure for telecoms and artificial intelligence.”
The fundraising will be conducted by the issuance of C shares, a separate class of shares that allows the company to raise money without hurting the performance of people who already own the stock. The C shares, valued at £1 a share, will convert into ordinary shares at periodic intervals.
Retail investors will be able to participate through RetailBook, a retail investment platform, while there will also be a placing to institutional investors. The retail offer is expected to close on May 6.
The company said the extra capital would “strengthen and expand SSIT’s portfolio through deployment into a pipeline of investment opportunities”.
Seraphim Space floated on the London Stock Exchange in July 2021 at 100p a share. The shares, which have risen by about 85 per cent since the start of the year, fell 8 per cent to 202p a share on Monday.
The company has invested in 45 space technology companies since its creation, many of which are now later-stage or public companies. Nine are worth more than $1 billion, so-called unicorns, while five other companies have been listed on the London Stock Exchange.
Seraphim’s largest holding is ICEYE, a Finnish satellite communications company which comprised 39 per cent of the fund’s net asset value at the end of last year. In December, ICEYE was valued at $2.4 billion. Earlier this month, HawkEye 360, a space analytics company which accounts for around 10 per cent of the company’s portfolio, filed to go public in the United States, also targeting a valuation of up to $2.4 billion.
Joachim Klement, head of strategy at Panmure Liberum, said: “The company is one of the star performers in the alternative closed-end fund space and in our view has a bright future with a long growth trajectory in one of the most exciting areas for venture capital at the moment.”
The fundraising comes amid growing interest in the ability for space technologies to reshape a wide range of industries, including defence, communications, insurance, and even agriculture.
Seraphim Space’s most recent index covering global space investment showed that funding reached $8.0 billion in the first quarter of the year, more than double the $3.9 billion in the previous three-month period. This pushed the 12-month investment to an all-time high of $18.8 billion. The figures also showed that investment has moved beyond satellite communications into other areas such as data centres and space stations.
Innovation in the sector has been fuelled by declining launch costs, which have fallen by more than 95 per cent over the last decade. This has been accelerated by SpaceX, the company founded by Elon Musk, which has pioneered the use of reusable rocket technology and maintained a high frequency of rocket launches. Last year, the company completed around 170 orbital launches.
SpaceX is targeting a record-breaking initial public offering this summer, which would help provide investors with a reference point for pricing other space tech companies and could attract further investment into the sector. The company is hoping to raise between $50 billion and $75 billion in fresh capital, which would comfortably surpass Saudi Aramco’s 2019 record for the largest public listing.