Shares in Electro Optic Systems Holdings Ltd (ASX: EOS) are rocketing 14% in morning trade following a positive company announcement.
At the time of writing, the defence contractor's shares are swapping hands for $3.14 apiece, up 14.18%.
This means that in the past month, the company's share price has soared more than 50% in value.
Image source: Getty Images
SpaceLink receives financial backing
In today's statement, Electro Optic Systems advised that SpaceLink has received conditional finance support from Export Finance Australia (EFA).
Based in the United States, SpaceLink is a wholly-owned Electro Optic Systems subsidiary that specialises in space and communications.
The non-binding letter of support will see up to US$80 million of debt funding for the initial satellite communications constellation (Block-0a) launch.
Late last month, Electro Optic Systems announced an initial funding requirement from US$700 million to US$240 million for Block-0a. This is because the constellation is a lower-cost design solution.
As a result, the latest offer will bring the projected launch date in line with Federal Communications Commission licensing requirements.
The US$80 million support represents one third of SpaceLink's total initial funding requirements for its US$240 million initial Block-0a constellation.
EFA funding is subject to a number of conditions, however. This includes:
- An independent technical review of SpaceLink's feasibility
- A comprehensive funding plan for SpaceLink
- Meeting EFA's eligibility criteria, credit and risk requirements
- Satisfactory ongoing financial and trading performance for Electro Optic Systems
- SpaceLink complying with EFA's environmental and social risk policies
Electro Optic Systems share price snapshot
Despite today's astronomical gains, it has been a difficult 12 months for Electro Optic Systems shares, down 40%.
The company's shares reached a 52-week low of $1.605 early this month, before rebounding over 100% within two weeks.
Electro Optic Systems commands a market capitalisation of roughly $467.83 million.
