VIGO signs conditional agreement with EIB for financing of HyperPIC project and development of projects related to infrared detectors and modules

 

VIGO signs conditional agreement with EIB for financing of HyperPIC project and development of projects related to infrared detectors and modules

 

VIGO Photonics S.A. (the “Company”), a global technological manufacturer of the most advanced mid-infrared photonic detectors and detection modules and semiconductor materials, has today entered into a financing agreement (the “Agreement”) under the InvestEU program with the European Investment Bank (the “EIB”). Under the Agreement, the EIB has committed to provide the Company with venture debt financing of up to EUR 21,000,000 (PLN 90,014,400). The Company has also entered into an agreement with the EIB on the issue of subscription warrants to the EIB (the “Warrant Agreement”).

The InvestEU program aims to provide financing for projects of strategic importance for the economy, contributing to the implementation of EU policies.

 

The purpose of the Financing Agreement concluded with the EIB is to support the continuation of VIGO's research and development work aimed at developing photonic integrated circuit (PIC) technology within the HyperPIC project, as well as infrared (IR) detectors and modules.

The financing will be paid in three tranches: Tranche A in the amount of EUR 6,000,000, Tranche B in the amount of EUR 7,000,000 and Tranche C in the amount of EUR 8,000,000. The tranches may be paid to the Company within a period of 12 to 36 months (depending on the given tranche) from the date of entry into force of the Agreement. The interest rate for each of the tranches will be 8% per annum.

The Financing Agreement is conditional and will enter into force subject to obtaining the consent of one of the banks financing the Company's operations, within a period not longer than 6 months from the date of signing the Financing Agreement.

Additional consideration for Tranche A, Tranche B and Tranche C will be the issuance by the Company to the EIB of subscription warrants representing in total 8% of the fully issued share capital and conditional capital of the Company ("Warrants"), which will be acquired by the EIB free of charge and will entitle the holder to acquire shares in the Company ("Shares") at a nominal price of PLN 1.00.

After fulfilling the conditions specified in the Agreement, including the condition of effective issuance and registration by the Company of subscription warrants in favor of the EIB in accordance with the conditions specified in the Warrant Agreement, the payment of Tranche A will be possible.

Regardless of the Agreement and Warrant Agreement signed with the EIB, VIGO will continue its activities aimed at securing other sources of financing for its operations. The Company does not rule out the possibility that if the Company obtains alternative financing on more favorable terms, the Agreement and Warrant Agreement will not be implemented.

 

"The decision to use specific financial solutions will be dictated by the interests of the Company and its shareholders and will depend on external economic conditions influencing the implementation of the Company's plans. The Agreement with the European Investment Bank is one of the options securing financing for our strategic HyperPic project, which will allow us to build the Company's long-term position within the adopted strategy and will have a positive impact on the perception of VIGO on the international market," says Łukasz Piekarski, Member of the Management Board of VIGO Photonics.

We are very pleased that such a renowned institution as the EIB trusted us, recognizing the potential of the HyperPIC project, and we were able to meet all the Bank's requirements. Thanks to the financing option, we will be able to accelerate the development of new products and introduce innovative sensors operating in the mid-infrared band, based on the technology of photonic integrated circuits, to the market - adds Łukasz Piekarski.

In May this year, VIGO signed an agreement with the National Center for Research and Development for co-financing the project "HyperPIC - Photonic integrated circuits for mid-infrared applications" under the European Funds for Modern Economy (FENG) program. The project will be implemented under the integrated European IPCEI ME/CT program (Important Projects of Common European Interest on Microelectronics and Communication Technologies). The total value of eligible costs in the project is PLN 853,117,563.35, and the maximum amount of public aid is PLN 440,535,480.00, which corresponds to the amount of the so-called financial gap in the project. Eligible costs in the project are research and development expenditure, expenditure on the construction of a new production line and operating costs after launching the new production line.

The HyperPIC project is planned to be implemented in 2023-2029 and consists of two phases:

• R&D phase (2023-2027), i.e. the phase of research and development work on new technologies for integrated photonics in the mid-infrared range and solutions for technological lines. The value of eligible costs in the R&D phase is PLN 146,366,042.37
• FID (First Industrial Deployment) phase, i.e. the first industrial implementation (2024-2029), covering investments in a new production line and implementation of new products into production, including financing part of the operating costs during implementation. The value of eligible costs in the FID phase is PLN 706,751,520.98

After the completion of the FID phase, it is planned to start serial production (after 2029). The aim of the HyperPIC project is to develop and implement the technology of photonic integrated circuits designed to work in the mid-infrared range (mid-IR), to build the world's first production line providing a complete value chain for MIRPIC (Mid Infra Red Photonic Integrated Circuits) systems. As a result of the project, VIGO Photonics will become the world's first manufacturer of photonic integrated circuits for the mid-infrared (MIRPIC).

Potential recipients of HyperPIC systems will be contractors from all over the world, using solutions from the broadly understood area of ​​sensor techniques in their products, including manufacturers of biomedical equipment, manufacturers of devices for monitoring industrial pollution, critical infrastructure operators, companies operating on the IoT market, telecommunications operators and integrators, the automotive industry, manufacturers of industrial machines and manufacturers of mobile devices.

 

The HyperPIC project is a multi-year investment program with a positive impact on the competitiveness of the Polish economy, which will also be an impulse for the development of the Polish photonics technology cluster. It will provide many new jobs, both directly in the project and in the ecosystem of partners and clients, and will attract engineering talent to Poland. Thanks to the HyperPIC project, we will introduce to the market innovative products on a global scale that meet the needs of AI, IoT, industry 4.0, agriculture 4.0, etc. I also expect a strong impact of the project on the entire ecosystem of Polish photonics, allowing Poland to ultimately become a significant player in the integrated photonics industry in Europe - says Adam Piotrowski, President of the Management Board of VIGO Photonics. 

The funds obtained from the EIB together with the NCBR grant will finance the R&D phase of the HyperPIC project, i.e. the phase of research and development work on new technologies for integrated photonics in the mid-infrared range and solutions for technological lines, which we intend to complete by the end of 2027. In addition, part of the funds from the EIB will be allocated to the development of the product offer in our traditional business of infrared detectors and modules, where we are constantly improving our technology and developing new, attractive product solutions for customers - summarizes Adam Piotrowski.

 

Contact for media and individual investors:

Piotr Piotrowski, cc group

piotr.piotrowski@ccgroup.pl, +48 697 613 010

 

Contact for institutional investors:

Małgorzata Młynarska, cc group

malgorzata.mlynarska@ccgroup.pl, +48 697 613 709

 

VIGO Photonics S.A. (WSE: VGO) is a global manufacturer of high-tech solutions - the most advanced mid-infrared photonic detectors, dedicated modules and semiconductor materials. Innovative devices have been recognized and used by numerous international customers from the industrial and transport sectors, environmental protection, medicine, defense and security. The quality of VIGO Photonics detectors was also confirmed during NASA's mission to Mars (including in the Curiosity rover) and their detection of traces of methane on this planet.

VIGO Photonics is successfully developing its activities in the field of semiconductor materials production. For this purpose, the Company has improved and uses the epitaxy technique (deposition of layers of selected crystals on a crystal substrate) using elements from groups III-V of the periodic table. In its development strategy, VIGO Photonics intends to supply the global market with photonic integrated circuits PIC (Photonic Integrated Circuits) based on semiconductors produced in this way. These systems will find numerous applications in the consumer electronics industry. The Company's goal is also to achieve a leading position in the emerging European silicon chip market.

 

VIGO Photonics (formerly VIGO Photonics) began its operations in 1987, and since 2014 has been listed on the main market of the Warsaw Stock Exchange. VIGO Photonics is headquartered in Ożarów Mazowiecki and has a subsidiary in the United States. The company employs approximately 200 high-class specialists and scientists.

 

In August 2022, the Company changed its name to VIGO Photonics, previously known as VIGO Photonics.

 

More information:

vigo.com.pl

linkedin.com/company/vigo-photonics

twitter.com/systemvigo (@SystemVigo)