Australian zinc-bromine flow battery maker Redflow has gone into a trading halt, after falling short of its latest capital-raising target by around $1.3 million.
The Brisbane-based company announced via the ASX that its recent Entitlement Offer raised a total of $4.899 million before closing on Friday – less than the $6.25 million that it aimed to raise.
“Redflow will consider its options and has requested a trading halt from ASX pending a further announcement in relation to the Company’s go forward plans,” a statement said on Wednesday.
The trading halt comes just under three months after the company released a fairly upbeat quarterly results update, including the news that its third generation zinc-bromine flow batteries were expected to deliver at least 30% in production cost reductions compared to the current model.
Redflow managing director Tim Harris said at the time that, despite the impact of Covid-19 on sales opportunities and customer engagement, the company was making the most of the enforced down-time to focus on developing “Gen 3” of the 10kWh ZMB battery. The fund raising was designed to bridge that revenue gap.
Harris said changes in engineering and design were expected to result in higher quality, lower-cost batteries, and pave the way for volume manufacturing at a competitive price point.
“Gen 3 is all about putting Redflow on the pathway towards a sustainable, vibrant volume manufacturing business,” he said in a video presentation at the time.
“We do expect this engineering work to deliver at least 30% cost reductions versus our current model at reasonable volumes.”
The company has not had an easy road, however, its early pitch at the residential market falling flat in the face of stiff competition from cheaper and more compact lithium-ion technologies.
With the backing of tech entrepreneur Simon Hackett – who also served a stint as CEO and chair of the company – Redflow quickly pivoted to a focus on the off-grid market and commercial-industrial markets, and shifted its manufacturing to Thailand.
Hackett remains Redflow’s largest shareholder, and in a June Entitlement Offer chose to tip another $450,000 into the company.