Former Minister of National Defence Harjit Sajjan’s new defence tech startup is laying the foundation for a public listing on the TSX Venture Exchange (TSXV).
Vancouver-based Juno Industries announced the sale of 15 million subscription receipts at 80 cents a piece on Friday morning, securing the company $12 million CAD in financing ahead of a planned merger and reverse takeover deal with TSXV-listed capital pool company (CPC) Trail Blazer Capital Corp ($TBLZ).
Subscription receipts are limited-term securities that are convertible into another security class at a set conversion rate when certain conditions are met, such as an acquisition. In this case, when Trailblazer acquires Juno, each receipt will become a share of the combined company after a 6-to-1 consolidation. Once the transaction is completed, the combined company is expected to be listed on the TSXV.
Juno is developing advanced autonomous robotic systems, AI-native command-and-control software, and persistent sensor fabrics for Canadian and allied national security.
CPCs help private companies complete go-public transactions and, according to the TSX, are the most common way that companies go public on TSXV. A qualifying transaction is essentially a reverse takeover of a CPC by a business that can then access the CPC’s capital, shareholders, and expertise to complete a public listing.
Sajjan co-founded Juno earlier this year alongside CEO Hunter Scharfe. The company says it is developing and deploying advanced autonomous robotic systems, AI-native command-and-control software, and persistent sensor fabrics for Canadian and allied national security.
No date has been set for Juno’s merger yet, which is still subject to approval from the exchange and shareholders. Juno’s $12 million in financing is being held in escrow until the transaction is completed, at which point the company said the capital will be used to fund its growth.
Juno did not disclose the round’s backers, only saying in a news release that it “welcomed new Canadian institutional, VC, and individual investors.”
Juno said the funds will be used to expand the company and its team, as well as on research and development (R&D), on opportunities for mergers and acquisitions, and to develop and deploy its solutions for Canadian and allied national security. Juno told BetaKit in an email that it has 20 employees, with plans to expand its R&D and tech team.
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Scharfe said in a statement that Canada and its NATO allies are at a “turning point” in national defence, and that Juno exists to lead that transformation.
“This round … accelerates our ability to build the technology and teams required to establish Canada as a serious, sovereign defence power,” Scharfe said. “We are pleased to partner with this group of investors and we are proud to broaden our work with the Armed Forces as we work to build Canada’s modern defence prime.”
Juno isn’t the only company trying to become a modern Canadian defence prime contractor; Eliot Pence, CEO of Ottawa-based Dominion Dynamics, courted $21 million in seed funding for pledging the same goal earlier this year.
In fact, both companies are starting out tackling the same problem: Arctic communications. Last month, Juno announced the development of an Arctic-ready autonomous platform called Polar Nexus, which aims to provide long-range communications and persistent integrated sensor capabilities for ISR (Intelligence, Surveillance, and Reconnaissance) and threat detection.
Feature image courtesy Juno Industries.