Babylon Pump & Power Announces $12.7 Million Non-Renounceable Entitlement Offer at AUD 0.05 per Share

Details of Babylon Pump & Power's Capital Raising and Entitlement Offer

Babylon Pump & Power Limited (ABN 47 009 436 908) has announced a non-renounceable pro rata entitlement offer to raise capital by issuing new ordinary shares. The offer is structured as a 2-for-1 entitlement, allowing eligible shareholders to subscribe for two new shares for every one share held as of the record date, 27 July 2026. The maximum issuance is 253,919,074 fully paid ordinary shares at AUD 0.05 per share. These new shares will rank equally with existing shares from the issue date.

The entitlement offer is non-renounceable, meaning shareholders who do not take up their entitlements cannot sell these rights. Fractional entitlements will be rounded up. The offer includes a shortfall facility where any unsubscribed entitlements will be available to eligible shareholders and other interested parties. The board holds discretion over shortfall allocations and will apply a pro rata scale back if oversubscribed, refunding any excess funds.

Timetable and Trading Schedule for the Capital Raise

The entitlement offer timetable sets the ex-date as 24 July 2026 and the record date as 27 July 2026 to determine eligible shareholders. Offer documents will be dispatched on 30 July 2026. The offer closes on 24 August 2026, with a possible extension deadline of 19 August 2026. Deferred settlement trading of new shares begins on 25 August 2026, prior to the official issue date.

The issue date and announcement of offer results are scheduled for 28 August 2026. Normal T+2 settlement trading will start on 31 August 2026, with final settlement for both deferred and normal trades on 2 September 2026. This timeline ensures proper processing and compliance with settlement procedures.

Shareholder Approval and ASX Waiver Conditions

Shareholder approval is required by 21 August 2026, as stipulated under an ASX waiver from Listing Rule 7.11.3, referenced in a 13 July 2026 ASX release. This approval is essential for the entitlement offer to proceed unconditionally. The timing of the approval date, three days before the offer closes, provides shareholders clarity on the offer’s status before investing.

Joint Lead Managers and Underwriting Details

Leeuwin Wealth and Cumulus Wealth serve as joint lead managers for the entitlement offer, receiving a 2.0% management fee on gross proceeds. A success fee of AUD 120,000 applies if cash subscriptions exceed AUD 7.5 million. Additionally, a 3.0% management fee applies to gross proceeds from convertible loan conversions, excluding certain Chairman’s list loans.

Leeuwin Wealth partially underwrites the offer up to AUD 7.27 million, comprising AUD 3.5 million general underwriting (offset by the first AUD 2.5 million in cash subscriptions and AUD 1.0 million debt-for-equity conversion) and AUD 3.77 million subordinated underwriting (offset by cash subscriptions above AUD 7.5 million). The underwriting fee is 4.0% of cash proceeds. If shareholders do not approve issuing AUD 1.23 million in deferred consideration shares to Blue Hire Vendors, underwriting increases to AUD 8.5 million, with subordinated underwriting rising to AUD 5.0 million.

Overview of Babylon Pump & Power's Operations and Market Position

Babylon Pump & Power Limited, an ASX-listed entity, operates in the pump and power sector. Although the update lacks detailed operational or geographic data, the capital raise indicates plans to fund growth or operational initiatives. The significant equity expansion through this offer reflects a strategic move to support business development or financial obligations.

References to Blue Hire Vendors concerning deferred consideration shares suggest recent acquisitions or integrations. The engagement of reputable financial advisors and underwriters highlights the professional management of the capital raise.

Offer Price Set at AUD 0.05 Per Share and Valuation Context

The board has set the offer price at AUD 0.05 per share for the entitlement offer. This price allows shareholders to subscribe for additional shares at this valuation. For example, a shareholder with 1,000 shares can subscribe for 2,000 new shares by investing AUD 100. The company has not disclosed how this price compares to current market prices, limiting assessment of any premium or discount.

If fully subscribed, the offer would raise approximately AUD 12.696 million before fees. Actual proceeds depend on shareholder uptake and shortfall performance. The underwriting commitment of AUD 7.27 million guarantees a minimum capital raise level.

Deferred Settlement Trading and Settlement Process

New shares will trade on a deferred settlement basis starting 25 August 2026, three days before the official issue date of 28 August 2026. This arrangement provides liquidity and price discovery before settlement. Trades during deferred settlement will settle on 2 September 2026, aligned with the normal T+2 settlement commencing 31 August 2026.

The transition to normal T+2 settlement ensures consistent and transparent trading and settlement for all shareholders.

Shortfall Offer and Allocation Discretion

Unsubscribed entitlements will be offered through a shortfall facility available to eligible shareholders and other interested parties. The board retains discretion over shortfall share allocations, allowing flexibility based on application size, shareholder profile, or strategic goals. In case of oversubscription, a pro rata scale back will apply, with refunds issued for excess payments.

Details on the shortfall mechanism are provided in sections 4.4 and 4.7 of the prospectus lodged on 21 July 2026. This approach ensures equitable and transparent management of the offer.

Prospectus and Regulatory Compliance

Babylon Pump & Power lodged a prospectus dated 21 July 2026 supporting the entitlement offer. The document complies with Australian securities law and ASX Listing Rules, offering shareholders detailed information on financials, risks, management, and use of proceeds. Sections 4.4, 4.6, and 4.7 cover offer mechanics, shortfall facility, and shareholder approval scenarios.

The company has applied for quotation of all securities issued under the prospectus on ASX per Appendix 2A requirements. Upon completion, an Appendix 2A form will be lodged to notify ASX of securities issued and request quotation. The ASX waiver under Listing Rule 7.11.3 enables the capital raise structure adopted.

Intended Use of Capital and Business Implications

While specific uses of proceeds are not detailed, the capital raise’s scale and structure imply plans to support operations, acquisitions, or settle liabilities. The reference to Blue Hire Vendors and deferred consideration shares indicates some funds may address transaction-related obligations. The involvement of professional advisors and partial underwriting underscores the seriousness of the capital raise.

Choosing a pro rata entitlement offer with an ASX waiver suggests management aims to preserve shareholder value and allow existing investors to maintain proportional ownership. The capital raise’s success depends on shareholder participation and shortfall demand exceeding the underwritten amount.