A Perth company developing technology to help the fast food industry is proposing to raise $20 million to help it expand globally.
Dragontail Systems, which floated on the ASX in December, has developed an algorithm to optimise food preparation and delivery service, as well as a camera system to take pictures of pizzas as they emerge from ovens to ensure their quality.
Dragontail says it has now entered a non-binding term sheet to raise $20 million by issuing convertible preference shares at 14.06¢.
“The funding will support the planned major expansion into the US, including sales and marketing support, as well as supporting the ongoing growth in other markets,” Dragontail said.
US-based investor Eldridge Industries intends to lead the round with an investment of $10.5 million, Dragontail says.
US investment advisory firm Goudy Park Capital LP will put in $5.5 million, with $4 million to come from Dragontail’s biggest Australian shareholder, Alceon Liquid Strategies Pty Ltd.
Dragontail says this fundraising round will enable it to expand its operations globally and repay its existing $4.3 million corporate loan with Alceo.
The funding is subject to conditions, including shareholder approvals.
Dragontail shares closed up 4.5¢, or 33.3 per cent, at 18¢.