Delta Drone International (ASX: DLT) has entered into a binding agreement with a consortium of investors led by NASDAQ-listed Medigus and facilitated by Israeli venture capital firm L.I.A Pure Capital to sell ParaZero Technologies which operates the Company’s drone safety business, for a total consideration of A$6 million in cash.
This transaction allows the Company to focus on becoming one of the leading drone service providers globally after its successful acquisition of the Delta Drone South Africa business in December 2020 and the purchase of Arvista in Australia in September 2021. Post-sale this will leave the Company with a strengthened balance sheet and a substantially reduced need for cash to fund the ongoing R&D investment that had been required by the ParaZero business, allowing the Company to focus on aggressively growing its global drone services business.
Key terms of the sale include:
- Purchase price of A$6 million payable to the Company in cash, with $5.1 million to be received on completion and $0.9 million to be released from escrow after 12 months(subject to there being no warranty claims);
- The Company to retain usage rights in relation to the use of the technology and products developed by ParaZero and
•The Company to retain additional equity upside in the transaction value from the issue of Warrants to invest in ParaZero again in the future under certain conditions
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