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4 March 2025

VELA TECHNOLOGIES PLC

("Vela" or "the Company")

Board Changes, Conditional Placing and Subscription, Share Capital Reorganisation,

Proposed Change of Name, Proposed Change of Investing Policy and

Notice of General Meeting

Highlights

-     Jim McColl and Chris Cooke join the board with immediate effect;

-     £1.1 million fundraise to underpin major new strategic re-focus;

-     £230,000 invested by the new Board of Directors;

-     Proposed new investing policy to focus on the financial services space; and

-     Proposed name change to Caledonian Holdings plc.

Jim McColl, the new Executive Director of Vela, comments: "I am delighted today, alongside Chris Cooke, to join the Board of Vela. The Company represents a unique platform for the creation of a major international financial services investment company, and I look forward to announcing the first steps in this ambitious strategy in the near future."

Background

Vela Technologies PLC (LSE: VELA), the AIM-quoted investing company focused on early stage and pre-IPO disruptive technology investments, is pleased to announce that it has conditionally raised £1,100,000 (before expenses) through a placing and a subscription (the "Fundraising") for 44,000,000,000 new ordinary shares (the "Fundraising Shares") at 0.0025p per share (the "Issue Price"). Peterhouse Capital Limited ("Peterhouse") acted as sole broker in connection with the Fundraising.

In addition, investors in the Fundraising will receive one warrant for every two Fundraising Shares subscribed for, exercisable at 0.0075p (the "Warrants").

Jim McColl and Chris Cooke have joined the Board with immediate effect. Jim has joined as an Executive Director and Chris as a Non-Executive Director. James Normand and Emma Wilson have stepped down as directors of the Company with immediate effect as part of these board changes.

The Fundraising is conditional on, inter alia, the approval of certain resolutions at a general meeting of the Company (the "GM" or "General Meeting") to be held on 24 March 2025. A circular containing a notice convening the GM will be sent to shareholders in the coming days and a further announcement will be made by the Company to confirm this.

The resolutions to be proposed at the GM (the "Resolutions") will ask shareholders to, inter alia, approve:  

·    a share capital reorganisation to reduce the nominal value of the ordinary shares of the Company given the Issue Price is below the current nominal value. The new nominal value is proposed to be 0.001p per new Ordinary Share;

·    the directors' authority to issue and allot the Fundraising Shares;

·    the adoption of a new investing policy; and

·    the change of the Company's name to Caledonian Holdings plc.

The Company will also change its ticker symbol to "CHP".

The change of name will be effective once approved by shareholders at the GM and Companies House has issued a certificate of incorporation on the change of name and a further announcement will be made when the name and ticker changes are formally effective. Until such time, trading will continue under the "VELA" TIDM.

Once posted, the Notice of General Meeting and Form of Proxy will be available on the Company's website at: www.velatechplc.com.

Board Changes

James ("Jim") McColl

Jim is currently:

·    Founder & Non-Executive Director of AlbaCo

·    Chairman of Clyde Blowers and Non-Executive Director at Amigo Holdings PLC

·    Chairman of Adam Smith Business School Strategic Advisory Board

·    Member of the Glasgow Economic Leadership Group

·    Member of the Scottish Energy Advisory Board

·    Member of the Scottish Apprenticeship Advisory Board

Jim McColl is an internationally renowned specialist in creating investor value by building businesses, with a track record spanning nearly three decades. Over that period, he has invested in 20 platform acquisitions, overseen 15 exits including two public listings and led a number of public to private transactions, mergers, demergers, spin outs and turnarounds.

This has included the successful turnaround of Clyde Blowers plc, a small engineering company with a full listing on the London Stock Exchange, in which he bought a 29.9% stake in 1992. With a 3% market share, he led the acquisition strategy of six of the company's seven global competitors capturing a 60% share of the world market over 5 years before taking the company private.

Over the past 30+ years Jim McColl has been the chief architect of significant expansion and growth for Clyde Blowers, developing the business into a portfolio of global engineering companies.

In May 2007, the acquisition of Weir Pumps (Glasgow) from The Weir Group PLC was announced. The diverse portfolio of technologies, process knowledge and expertise generated by Weir Pumps was incorporated into a newly created company, Clyde Pumps Ltd, and in so doing 600 jobs and an important part of Scotland's engineering heritage was saved. 

In September 2008, Jim led the largest transaction in Clyde Blowers' history by acquiring the entire Fluid & Power Division of Textron Inc, an American Fortune 500 multi-industry company in a deal worth over $1 billion. This included a US company, Union Pumps, which was merged with Clyde Pumps in 2008 to form Clyde Union Pumps. The combined business was sold 3 years later in 2011 for a return of 4x invested capital.

More recently, in 2018, Jim founded AlbaCo with a view to establishing a new Scottish based challenger bank focussed on serving the SME market with dedicated relationship management and modern digital IT. AlbaCo expects to be awarded a full banking licence during the first half of 2025 enabling it to take deposits and start lending.

Jim is actively involved in promoting enterprise and enterprise education with a particular interest in improving the life chances for disadvantaged young people. In 2014, he set up Newlands Junior College. His vision was to create a Junior College for young teenagers at risk of disengaging from local secondary schools that would give them support and opportunity to move on to a successful and rewarding future by providing alternative curricular programmes.

Chris Cooke

Chris invests in small UK companies with a focus on engineering, clean energy and life sciences in particular. He has also worked as an independent business and organisational consultant for the last 15 or so years, prior to which he was a senior human resources professional mainly in engineering, technology and manufacturing enterprises. Two of Chris' interim roles have been Interim Director of People at Railpen Investments (one of the world's largest pension funds and asset allocators) and as Interim Executive Director of People at the Student Loans Company (a very large publicly owned financial and lending institution).

He holds a Bachelor's degree from the University of Manchester, and Masters degrees in Strategic HR, and in Organisational Psychology from Hull and Sheffield universities respectively. His most recent consultancy assignments have involved advising and consulting with private owners of significant owner-managed businesses in the healthcare and manufacturing/engineering industries. He has been invested in Vela for over 5 years and intends as a Non-Executive Director to represent large and small shareholders and to help the team leading Vela into a new, successful phase.

Further details regarding Jim McColl and Chris Cooke required to be disclosed by the AIM Rules for Companies is set out at the end of this announcement.

Details of the proposed Fundraising

Peterhouse, as agent for the Company, has conditionally raised approximately £827,000 (before expenses) through a placing of 33,080,000,000 new ordinary shares (the "Placing Shares") with new and existing investors at the Issue Price (the "Placing") and £273,000 through a subscription for 10,920,000,000 new ordinary shares (the "Subscription Shares") at the Issue Price (the "Subscription"). The Issue Price represents a discount of approximately 50.0 per cent. to the mid-market closing price of 0.005 pence per share on 3 March 2025.

The Fundraising has not been underwritten and is conditional, inter alia, upon:

a)         the passing of the Resolutions in relation to the Fundraising;

b)         completion of the Share Capital Reorganisation (defined below); and

c)         Admission occurring by no later than 8:00 a.m. on 27 March 2025 (or such later time and/or date as the Company and Peterhouse may agree, not being later than 30 April 2025).

If these conditions are not met, then the Fundraising will not proceed.  

Details of the Placing

Peterhouse has procured subscribers for the Placing Shares at the Issue Price. The Placing is not underwritten and is conditional on, inter alia, the approval of the Resolutions in relation to the Fundraising and Admission. The Placing Shares will represent approximately 52.5 per cent. of the Enlarged Share Capital.

Brent Fitzpatrick (Non-Executive Chairman) has conditionally subscribed for 400,000,000 Placing Shares at the Issue Price.

If the conditions for the Placing are not satisfied or waived (where capable of waiver), the Placing will lapse and the Placing Shares will not be allotted and issued and no monies will be received by the Company pursuant to the Placing.

The Placing Shares will, when issued and fully paid, rank pari passu in all respects with the other New Ordinary Shares then in issue, including the right to receive all dividends and other distributions declared, made or paid after the date of Admission.

Details of the Subscription

Prior to his appointment to the board of the Company, Jim McColl conditionally subscribed for 8,000,000,000 Subscription Shares at the Issue Price raising gross proceeds of £200,000. In addition, Chris Cooke (Non-Executive Director), James Normand (former director), Emma Wilson (former director) and certain other investors have conditionally subscribed for a total of 2,920,000,000 Subscription Shares at the Issue Price raising gross proceeds of £73,000.

The Subscription is not underwritten and is conditional on the approval of the Resolutions in relation to the Fundraising, completion of the Share Capital Reorganisation, completion of the Placing and Admission.

If the conditions for the Subscription are not satisfied or waived (where capable of waiver), the Subscription will lapse and the Subscription Shares will not be allotted and issued and no monies will be received by the Company pursuant to the Subscription.

The Subscription Shares will, when issued and fully paid, rank pari passu in all respects with the other ordinary shares then in issue, including the right to receive all dividends and other distributions declared, made or paid after the date of Admission.

Warrants

Participants of the Fundraising will receive one warrant for every two Fundraising Shares subscribed for as part of the Fundraising ("Warrants") which will result in the issue of 22,000,000,000 Warrants. The Warrants will be valid for two years from the date of the Placing and will have an exercise price of 0.0075 pence. The Warrants have an accelerator clause: if the share price of the Company's shares is sustained at a price greater than 0.015 pence for five consecutive trading days the Company may choose to force execution of the Warrants at the exercise price of 0.0075p. The Company is obliged to write to each Warrant holder providing seven calendar days' notice to exercise the warrants (the "Notice"), after which each Warrant holder will have up to 14 days to pay for the exercise of their Warrants, subject to the terms of the Warrant Deed. Warrants for which notice of execution is not given within 7 days from the date of Notice will be forfeited.

Use of proceeds

It is intended that the net proceeds of the Fundraising will principally be used to make investments within the financial services sector (see the proposed change of investing policy) and for general working capital purposes.

Existing and former Director participation in the Fundraising

Brent Fitzpatrick and new directors Jim McColl and Chris Cooke, together with former directors James Normand and Emma Wilson, have conditionally subscribed for a total of 9,600,000,000 Fundraising Shares at the Issue Price as follows:

*Includes 83,709,962 Ordinary Shares held by Chris Cooke's youngest child who is under the age of 18 years.

Grant of Share Options

Jim McColl has agreed to neither accrue, nor be paid, a salary as an Executive Director. In light of the above, in addition to his £200,000 cash investment and to further align the interests of the Company with Jim McColl, the Company has agreed, subject only to approval of the Resolutions and the completion of the Fundraising, to grant options over 13,325,883,776 new ordinary shares to Jim McColl (the "Options"). The Options are a contractual entitlement for Mr. McColl under the terms of his appointment as a director of the Company.

The Options will be valid for two years from the date of the GM and will be exercisable at the Issue Price. The Options will vest upon the completion of Vela's first investment following Jim McColl's appointment.

The Options, if exercised in full, would represent approximately 17.5% of the enlarged issued share capital of the Company (as enlarged following the issue of the Fundraising Shares and the exercise of the Options only).

Share Capital Reorganisation

Under the Companies Act, a company is unable to issue shares at a subscription price which is less than the nominal value of shares of the same class. This means that, as the nominal value of the existing ordinary shares is currently 0.01 pence, the Company could not issue further ordinary shares at the Issue Price without a sub-division of the existing ordinary shares. The Board, therefore, has concluded that it is essential to implement a share capital reorganisation to reduce the nominal value of the ordinary shares ("Share Capital Reorganisation") to become lower than the Issue Price, so that the Company can proceed with the Fundraising.

Accordingly, it is proposed to sub-divide each existing ordinary share of 0.01 pence each ("Existing Ordinary Shares") into one new ordinary share of 0.001 pence each ("New Ordinary Share"), 0.001 pence being the proposed new nominal value per share, and one deferred share of 0.009 pence each ("Deferred Share").

The New Ordinary Shares will, in all material respects, have the same rights (including rights as to voting, dividends and return of capital) as the Existing Ordinary Shares, save for their nominal value. The New Ordinary Shares will be traded on AIM in the same way as the Existing Ordinary Shares, with the exception of the difference in nominal value. The nominal value of shares already held in CREST will be updated at approximately 8:00 a.m. on 27 March 2025.

Proposed timetable

Proposed New Investing Policy

The Board of Directors, now comprising Brent Fitzpatrick, Jim McColl and Chris Cooke, have reviewed the Company's investing policy and consider that it should be amended to primarily focus on investments in enterprises within the financial services space and to achieve long-term capital appreciation by investing in high-potential financial services firms, particularly in wealth management, fintech, and specialist lending. 

The proposed new policy is set out below and will require approval of a resolution to be put to shareholders at the General Meeting:

Investing Policy

The Company's investing policy is focused primarily on companies operating within the financial services and associated markets.  Within that over-arching strategy, the Company applies the following criteria in reaching an investment decision.

Stage of development

Usually (but not necessarily) investee businesses will have been operating for a number of years.  The investee business may not yet have achieved profitability.

Geographical focus

Investee companies will usually be based in the UK (including the Channel Islands) or Europe and/or derive a material proportion of their business from the UK.  Conversely, investee companies may derive a significant proportion of their income from overseas but be based in the UK.  It is unlikely that Vela would invest in a business headquartered overseas and deriving a majority of its business from outside the UK.

Sector focus

The Company mainly focuses on investments within the financial services sector, targeting businesses that demonstrate strong growth potential, innovative financial solutions, and scalable business models. Primary areas of interest include fintech, asset management, insurance, and banking, with an emphasis on companies that leverage technology to enhance efficiency, accessibility, and financial inclusion.

Corporate status

The Company aims to have a mix of private and publicly-traded investments.

The private companies will generally need to have ambitions for a public listing in a relatively short time period (i.e. within two years of investment); or, failing that, a plan to find a buyer for the business or to scale up the business (e.g. by merging with or acquiring another or by raising material additional equity funding) within a similar timescale.

Investments in public companies will usually be made as part of a development capital financing designed to accelerate the growth of the business.

Investment instruments

The Company will generally expect to make investments in the form of equity.  It will also consider investing in loan stock which is convertible (at Vela's option) into equity shares. The Company's investments will rarely be in the form of pure debt.

Investments will usually be in the form of cash but may also take the form of an issue of new ordinary shares.

In the case of equity investments, the Directors intend to take minority positions and investments will therefore typically be of a passive nature.

Holding period

The Company generally invests with the intention of realising its investment within three years of investment.  Investments can be made at the pre-IPO stage and in anticipation of a public listing for the shares, often within a few months.  In such cases the whole or part of the investment may be sold on admission of the investee company's shares to trading on a stock exchange.

Investments in companies whose shares are not traded on a public exchange are, of course, inherently more difficult to realise; and so, although there may be an intention to list the shares or to see the business sold, the Company may need to hold an investment in a private company for a longer time period.

The Directors intend to re-invest the proceeds of disposals in accordance with the Company's investing policy unless, at the relevant time, the Directors believe that there are no suitable investment opportunities in which case the Directors will consider returning the proceeds to shareholders in a tax efficient manner.

Number and size of investments

There is no limit on the number of projects into which the Company may invest except the capacity of Vela's investment team to appraise and monitor them.  Similarly, the monetary quantum of each investment is a factor of the funds available to the Company at the point of investment.  Both the number and size of investments will therefore vary according to the Company's human and monetary resources.  Each of these will be referred to in the Company's annual and interim reports.  As investments are made and new promising investment opportunities arise, further funding of the Company may be required to enable the Company to make further investments.

The Company will pursue a balanced portfolio of an even mixture of early stage, pre-liquidity event and liquid investments.  While the aim is to have the portfolio split fairly evenly between the different stages of liquidity, there will be no set criteria for the proportion of the portfolio which will be represented by each investment type.

Although the percentage holdings taken by way of equity interests will vary, such interests will always constitute a minority (i.e. below 50%) position. Further, unless in cases where the management believe exceptional value may be accrued and/or the Company is seeking to play a more proactive role in its investee companies, generally investments will not exceed 25% of an investee's issued capital.

Opportunistic investments

As a result of the Company's network of contacts in the financial markets, it occasionally receives invitations to invest in businesses which do not meet the core criteria of the investing policy.  Nevertheless, if the Board considers that there is an opportunity to benefit by investing in such a proposition and thus allowing its shareholders access to investments in which they may otherwise not be able to participate, it may consider doing so. Such investments will be limited at 10% of the Company's net asset value and would usually be made on the understanding and expectation that any such investment would be held for the short term only.

Follow-on investments in existing investment portfolio

In addition, the investing policy will enable the Company to make, where the Board deems appropriate, follow-on investments in the Company's investment portfolio which was in place as at March 2025 prior to the change in focus to financial services and which predominately are companies in the disruptive technology sector.

Investment appraisal

In order to mitigate investment risk, the Directors will carry out a thorough appraisal of each potential investment.  This appraisal may include site visits, analysis of financial, legal and operational aspects of each investment opportunity, meetings with management, risk analysis, review of corporate governance and anti-corruption procedures and, where the Directors see fit, the seeking of third party expert opinions and valuation reports. The Company will not have a separate investment manager.

Nature of returns

It is anticipated that returns to the Company will be delivered through a combination of capital gain, dividend income and interest on convertible loans.

Given the Company's expected percentage holdings in investee businesses, it will be unusual for the Company to seek or be offered a position on the investee's board of directors.  However, in those instances where it is felt desirable and appropriate for Vela to appoint a director, the fee earned from any such post held by a director or employee of Vela would be payable to Vela and form part of the return earned by Vela on its investment.

Cash held by the Company pending investment, reinvestment or distribution will be managed by the Company and placed on deposit with banks so as to protect the capital value of the Company's cash assets.  The Company may, where appropriate, enter into agreements or contracts in order to hedge against interest rate or currency risks.

Review of investing policy

The Directors will keep the investing policy under continuous review and will make and announce any non-material changes or variations as may be appropriate.  Any material change or variation of the investing policy will be subject to prior approval of shareholders.

Admission and Total Voting Rights

The Fundraising Shares will rank pari passu in all respects with the Company's ordinary shares following the approval of the Resolutions in relation to the Fundraising.  Application will be made to the London Stock Exchange for the Fundraising Shares to be admitted to trading on AIM ("Admission"). It is expected that Admission will become effective and that dealings in the Fundraising Shares on AIM will commence at 8.00 a.m. on or around 27 March 2025.

Following Admission, the issued share capital of the Company will comprise 62,970,695,255 ordinary shares of 0.001 pence each (the "Ordinary Shares"), with one vote per share. The Company does not hold any ordinary shares in Treasury.  Therefore, on Admission, the total number of Ordinary Shares and voting rights in the Company will be 62,970,695,255. With effect from Admission, this figure may be used by shareholders as the denominator for the calculation to determine if there is a requirement under the FCA's Disclosure Guidance and Transparency Rules to notify an interest in, or a change of interest in, the share capital of the Company.

AIM Disclosures

The following information is disclosed pursuant to Rule 17 and Schedule Two paragraph (g) of the AIM Rules for Companies.

James ("Jim") Allan McColl, who is aged 73, has the following current or past directorships or partnerships:

Jim McColl was formerly a director of Ferguson Marine Engineering (Holdings) Limited ("FMHE"), and its subsidiaries Ferguson Marine Engineering Limited ("FME") and Mackellar Sub-Sea Limited ("MSS"). The directors of FME appointed administrators on 16 August 2019. Jim McColl ceased to be a director of FME on 23 August 2019. The directors of MSS appointed administrators to MSS on 22 October 2019. Jim McColl ceased to be a director of MSS on 9 December 2019. The directors of FMHE appointed administrators to FMHE on 22 October 2019. Jim McColl ceased to be a director of FMHE on 12 December 2019.

Jim McColl was formerly a director of Ideal Furniture Enterprises Limited ("IFEL"). A receiver was appointed to IFEL in 1992 and IFEL was dissolved on 15 February 2000. Jim McColl ceased to be a director on 15 February 2000.

Christopher ("Chris") David Cooke, who is aged 58, has the following current or past directorships or partnerships:

Chris Cooke (including the holding of his 17 year old daughter) holds 1,935,376,945, representing 10.20% of the Company's current issued share capital.

For further information, please contact: