Today’s update on the refinancing of its Convertible Loan Note (CLN) from Seeing Machines, is most welcome as it’s probably the main issue that has concerned investors.

While the likely terms of any agreement aren’t yet known, analyst Peter McNally from joint house broker Stifel is optimistic given today’s announcement that Seeing Machines has received multiple term sheets.

While term sheets aren’t a final agreement, they do prove that Seeing Machines has multiple options open to it. “This includes bank debt, specialist lenders, strategic entities and amended terms from Magna, its close partner and the noteholder of the existing convertible loan,” according to McNally.

I certainly don’t want to see further dilution yet would anticipate that the $62m, due by October 4th 2026, offers some strategic investor/lender an opportunity to make a lot of money quite quickly at minimal risk. 

Seeing Machines is, after all, unquestionably the global leader in driver monitoring, with attendant cash flows. Once this CLN hurdle is cleared, with auto royalties climbing, alongside aftermarket ARR the share should climb, provided the  growing cashflow isn’t accompanied by a ramp in spending by management.

I asked Chat GPT what it thinks about the most likely outcome. Here’s what it told me:

1. Non-dilutive debt facility — now my clear favourite

I would put this at perhaps 70%+.

The announcement specifically says:

• “potential lenders”
• “multiple term sheets”
• refinancing the Convertible Note
• completion well ahead of maturity

That language points towards a conventional lending process rather than an equity transaction.

Potential lenders could be:

• specialist technology/growth lenders,
• private credit funds,
• banks comfortable with IP-backed lending,
• perhaps a lender familiar with automotive software.

The attraction for SEE:

• no dilution,
• removes the overhang of the Magna conversion,
• keeps upside with shareholders.

The question is interest cost. They may have to pay more than Magna’s effective economics.

2. Mitsubishi strategic loan

Mitsubishi Electric Mobility is already a major shareholder (around 19.9% according to SEE’s investor information).

A Mitsubishi-backed refinancing would be very logical if:

• Mitsubishi views SEE as a strategic asset,
• it wants to deepen the relationship,
• it wants to prevent another party gaining influence.

A structure could be:

• Mitsubishi lends $50–60m
• no conversion rights
• commercial partnership expanded
• perhaps security over certain assets/contracts

That would fit the “avoid dilution” message very well.

I would put Mitsubishi/strategic partner debt at 25–30%.

3. Magna itself refinancing

There is an irony here: Magna is the current lender and understands the asset better than anyone.

But Magna already has exposure. If it wanted more ownership, the existing note gives it a route. A refinancing might be more about preserving its strategic position.

A Magna rollover could be:

• extend maturity,
• remove conversion,
• lower/higher interest depending on negotiations.

Probability maybe 15–20%.

4. Waymo 

Waymo would be exciting, but I think it is the least likely refinancing source.

If Waymo wanted SEE exposure, I would expect:

• partnership,
• licensing,
• acquisition interest,

rather than acting as a lender.

The thing I find most interesting is that SEE’s bargaining position may have improved materially since the Magna note was signed:

• automotive production volumes are scaling,
• cars-on-road are now in the millions,
• ARR is growing.

A lender in 2022 was financing a promising technology company. A lender in 2026 is financing a company with embedded OEM programmes and recurring revenue.

So my view:

Outcome	Probability
Non-dilutive institutional debt	50–60%
Mitsubishi-backed strategic refinancing	20–30%
Magna rollover	10–15%
New convertible	<10%
Waymo	very low

The more bullish interpretation is: if Mitsubishi or another strategic player provides the refinancing without conversion rights, it could be a quiet signal that they see SEE as strategically valuable and do not want equity dilution to shareholders.

The human writer holds stock in Seeing Machines. (Chat GPT would like to invest but can’t).