Interactive Investor

Space investment trust set for lift off after IPO oversubscribed

12th July 2021 11:39

Kyle Caldwell from interactive investor

The first ever space-themed trust proved popular and will make its stock market debut this week.

The first space-themed investment trust had to scale back applications ahead of its IPO due to high demand from investors. 

The Seraphim Space Investment Trust (LSE:SSIT), which will have the ticker SSIT, raised its target of £150 million from investors. An additional £28.4 million was raised via a seed portfolio of 19 assets. 

The shares will start trading on the London Stock Exchange on Wednesday 14 July. 

In an announcement to the market, the trust noted “the capital raise was oversubscribed with demand exceeding the target fundraise amount of £150 million. Accordingly, applications were scaled back so that commitments under the capital raise equal the £150 million target amount.”

Seraphim Space manages the Seraphim Space Fund, which is the world’s first venture capital fund focused on new space technologies. The trust will invest in a diversified international portfolio of early and growth-stage space tech businesses. 

The trust defines the sort of companies it will hold as those “which rely on space-based connectivity or precision, navigation and timing signals or whose technology or services are already addressing, originally derived from, or of potential benefit to the space sector”.

The management fee is 1.25% of net asset up to £300 million, dropping to 1% when assets rise above that.  

Will Whitehorn, chair of Seraphim Space Investment Trust, commented: “Seraphim is the world’s number one investor in Space tech, a sector that to date has been driven by private capital.  

“Our IPO on the main market of the London Stock Exchange gives investors unparalleled early access to companies that will shape a new economic revolution.  We are delighted with the support received from retail and institutional investors alike. We look forward to playing our part, as an ambitious investor, in the space industrial revolution which is now under way around the globe and above it.”

The trust is targeting net asset value total returns of at least 20% per year over the long term. 

Mark Boggett, chief executive officer of Seraphim Space, said: “Space is now ‘open for business’ and no longer just the preserve for billionaires. Seraphim Space Investment Trust is aiming to back the next generation of space entrepreneurs who are looking to harness the infinite potential of space to help solve some of our world’s most pressing problems.

“With the space sector now at a major inflection point, ‘Space tech’ looks set to become a multi-decade, multi-trillion investment opportunity – one which Seraphim is already at the forefront of.

“Seraphim Space Investment Trust is offering for the first time public market investors the opportunity to get diversified exposure to the private companies leading this exciting investment area. We are delighted that investors in our IPO share our enthusiasm for helping to make science fiction become science fact.”

The IPO is hot on the heels of the YODA exchange-traded fund (ETF). The Procure Space ETF USD (LSE:YODA) listed on the London Stock Exchange in early June, making it Europe’s first space thematic ETF. For an ongoing charge of 0.75%, the ETF tracks the S-Network Space index.

Seraphim Space Investment Trust’s successful IPO comes against a backdrop of bumper demand for trusts. In the first six months of this year, a record £6.3 billion was invested into existing companies and IPOs

A recently proposed IPO that failed to get off the ground was Liontrust ESG. The trust, which planned to invest in a sustainable manner, cited a lack of investor demand.

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