Published: 2022-01-06 22:12:05 CET
Elmo Rent
Company Announcement

Further comments to the additional fundraising that ends on 10 January 2022

1. Share price (financial and technical reasons)

Financial: In the course of the initial public offering of the shares of ELMO Rent held in June 2021, shares were subscribed at the price of 5 euros per share, for 1,923,050 euros in total, which exceeded the offering by 3.2 times. The promises made in the introduction of the IPO were fulfilled and we also increased our sales turnover forecasts for 2021 by 15% (to 1,075,000 euros), by 28% for 2022 (to 3,481,704 euros) and by 34% for 2023 (to 6,311,018 euros), i.e., by 25% on the average (see the stock exchange announcement from 21 December 2021): https://view.news.eu.nasdaq.com/view?id=b28d279456c07f4fe3a914885d48d4638&lang=et)

Technical: pursuant to the procedure for a new share issue and the SPO, the minimum price of the shares must be determined approximately one month before the public offering of shares. Considering the trading price of ELMO Rent’s shares at the end of November (5.2 euros) and the updated objectives for after the SPO (including the acquisition of Elektritakso OÜ and opening the new taxi business), we were convinced that the share price would increase by at least 10%, or to 5.5 euros.

Between 22 November 2021 and 4 January 2022, the share price rose to 5.47 euros, having grown by more than 9%, please see the annex nr 1.


2. Time of subscription 

We foresaw already at the time of preparing the IPO that further funds should be raised at the end of 2021 and at the beginning of 2022. The delivery terms of new cars necessary for entering new markets have been extended to more than six months. As new sales quotas have been established for car sellers at the beginning of this new year, it is important for ELMO Rent to ensure an order of a large number of new cars right at the beginning of the year. This will support the achievement of the objectives promised in the introduction of the SPO.

The SPO therefore fell on the holiday period. 


3. Fundraising objectives

The acquisition of Elektritakso OÜ and the development of the new taxi business

We plan to use up to 20% of the engaged resources to acquire Elektritakso OÜ and to merge the two companies, to develop the new business area and launch the taxi service in Tallinn.

We forecast the sales turnover to grow by at least 25% (by approximately 450,000 euros in 2022) and the number of drive sessions by approximately 20 times with the acquisition of Elektritakso OÜ. We will gain an additional workforce as new taxi drivers join the community and can also work as remote technology drivers according to the needs of the market. As a part of the purchase transaction, all the shareholders of Elektritakso will become the shareholders of ELMO Rent, which will ensure additional competence. As a joint team, we will open the taxi service business also in Tallinn in addition to Tartu and Pärnu, and then on new foreign markets. 


At least 20 remotely controlled cars on city streets in 2022

We plan to use up to 10% of the engaged resources to prepare and street-test at least another 20 cars equipped with the remote-control technology, and use the experience gained from that to make additional upgrades to the technology. In order to complete the technology, we also received support from Enterprise Estonia in the amount of 374,094 euros (see the stock exchange announcement from 28 December 2021: https://view.news.eu.nasdaq.com/view?id=b5966a313c5ce3fbd598a1aa889efa897&lang=et). 

In November 2021, our remote-control technology passed the first part of the official site testing of the Estonian Transport Administration and we are currently preparing for the commencement of street tests (see the stock exchange announcement from 17 November 2021: https://view.news.eu.nasdaq.com/view?id=b362dd875739a66c3800596a073e0170c&lang=et).

We are planning to start the official street testing in the first months of 2022. In order to quickly gain experience in this stage, we need more test kilometres, which also means more test cars.

During street testing, we can already provide services to our customers – a car is driven to the customer’s door together with a back-up driver, the testing then stops, the customer takes the wheel, and the testing continues after the rental session. 


A vehicle fleet that meets the demand

We plan to use up to 30% of the engaged resources to expand the vehicle fleet, also in the premium class, placing purchase orders as early as possible, considering the long delivery terms.


The international business area

We plan to use up to 30% of the engaged resources to carry out preliminary work for entering foreign markets, including to acquire possible companies that are already operating, and to make initial investments upon launching the services.

We have already performed preliminary work for entering the Finnish, Swedish and Polish markets.

Strategically, ELMO Rent has three mutually supportive business areas for entering new markets. For instance, while it is worth entering Helsinki first with the taxi service, it is also worth adding the short-term rental in the near future, etc.

In order to ensure a rapid growth and lower risks, we prefer acquiring shares in an existing company for entering a market. This reduces our risks in leasing cars in a new market where we do not have a credit history.

Powerful software

We plan to use up to 10% of the engaged resources to further develop the software (car fleet back-end, front-end, app), increase the data gathering volume, and create an operative analysis capability.

In 2018, we merged a competitor Minirent OÜ with ELMO Rent, thus acquiring an efficient car fleet management operating system. By today, the system’s functions are more efficient than those offered in the market, but the content and the visual side need updating.

With the proceeds from the IPO, we developed a new app which will allow us to more easily integrate the functions related to the taxi service and the remotely controlled cars in the future.


For more detailed information about the objectives of the SPO and the goals achieved, see https://elmorent.ee/en/investor-relations/


More infromation:


Julia Nekrsassova




Enn Laansoo, Jr.

Chairman of the Advisory Board


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