A Perth company that’s 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 cents.
“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 says in a statement on Wednesday.
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 were up 3 cents, or 22.22 per cent, at 16.5 cents at 1420 AEDT.