Eve Air Mobility secures USD 94 million in new shareholder funding
Eve Air Mobility secures USD 94 million in new shareholder funding
Eve Air Mobility – which was set up as a subsidiary of Brazilian aerospace conglomerate Embraer – has garnered USD 94 million in equity investment to bolster its financial standing as an independent business at a time when many other Advanced Air Mobility (AAM) players are struggling to raise capital. The increase in equity of USD 94 million will be obtained from a private placement that the company plans on conducting in the near future.
This includes USD 30 million new shares and warrants to Embraer, and USD 20 million of shares and warrants to Nidec, a key supplier of electrical propulsion systems through a JV with Embraer for the eve aircraft. As mentioned, the investors who participated in this round of fundraising were not revealed by Eve.
Eve plans to ‘finalise the equity round in the coming weeks,’ according to Eduardo Couto, Eve’s Chief Financial Officer, who expressed much appreciation towards investors. During the call, Couto explained that with the new equity, along with cash in hand and credit facilities, Eve has a formidable foundation to accelerate eVTOL electric vertical take-off and landing vehicle advancement and production.
As of 1Q 2024, Eve has USD 280 million in sources of liquidity, including undrawn parts of facilities from Banco Nacional de Desenvolvimento Econômico e Social do Brasil; the company stated that it is ready for the financial year 2025+.
Less than a year worth of funding has been provided by the USD 94 million even if the expenditure of approximately USD 36 million was for the first quarter only.
When considering the capital raise, SMG Consulting’s analyst Sergio Cecutta observed that Eve enjoys strong backing from Embraer, adding that while many eVTOL startups struggle with funding, Eve has no such issues. He also highlighted how Eve had a purchasing cost advantage in Brazil over rivals present in Europe and the US, which added to its competitive positioning.
Several leading AAM startups such as Lilium and Volocopter have recently managed to secure funding; however, many other startups that lacked the support of corporations and institutions are currently experiencing difficulties due to a rather unfavourable capital market environment. This has left questions on closures for new start up companies who may not gain enough funding for operation.
Eve’s latest capital boost comes at the time when it works on the final touches of its first full-scale mockup that has to undergo flying tests in the second half of 2024. It has a goal in obtaining type certification for its offer aircraft towards service entry by 2027.
