An extraordinary general meeting of shareholders on December 23, approved a $50 million funding package to sustain Vertical Aerospace’s work on its VX4 eVTOL aircraft. The vote backed an agreement reached on November 25 through which Mudrick Capital committed to a fresh equity round that will also involve converting around $130 million of debt into equity.

The investment agreement was signed on December 20 by Vertical’s majority shareholder, Stephen Fitzpatrick, and Mudrick Capital, which is the company’s primary creditor. On December 15, Mudrick agreed not to enforce certain default terms covering its earlier investment. The agreement approved by shareholders extends the repayment date for Mudrick's loan to Vertical by two years up to December 2028.

Meanwhile, prospects for German eVTOL aircraft developer Lilium to be saved from collapse appeared to be fading in the light of multiple reports that the company had laid off most of its staff on December 20. The company has not commented on the status of efforts by KPMG to find a buyer, but social media posts by former employees indicated that Lilium has effectively ceased operations.

Vertical Set For Cash Injection

Announcing third quarter financial results, Vertical said that, as of September 30, it held £42.8 million ($54 million) in cash or cash equivalents. By December 20, these reserves stood at £25 million, with the new funding round expected to close in the first quarter of 2025.

“This has been a momentous quarter for the business,” said Vertical CEO Stuart Simpson, “We have shared our strategic plan to lead the market by the end of the decade, begun what few in the industry have achieved with our piloted test program, and signed a significant investment agreement that strengthens our balance sheet and funds us towards the end of next year.”

According to Vertical, the injection of capital and debt restructuring will be sufficient to fund operations “towards the end of 2025” as it implements the Flightpath 2030 strategy it announced in November. The company recently started the second phase of the flight test program with a full-scale prototype of the four-passenger eVTOL model, for which it is now targeting type certification in 2028, having confirmed a delay of almost two years.

The deal finalized on December 23 completed the conversion of $130 million of debt into equity at a conversion price of $2.75 million per ordinary share. The agreement also fixes for the remaining $130 million at $3.50 per ordinary share. Mudrick Capital has committed to release $25 million in fresh capital up front and to provide an additional $25 million as a backstop that could be partly sourced from third party investments.

"Vertical is revolutionizing how the world moves, and we are proud to play a pivotal role in positioning the company for success," said Jason Mudrick, found and chief investment officer of Mudrick Capital Management. "We look forward to partnering with Vertical's exceptional team and contributing capital market and other expertise in helping to bring their groundbreaking product offering to reality."