- Keytone Dairy (KTD) has received binding commitments for a $12.5 million placement
- Approximately 40.3 million shares will be issued to institutional and professional investors at a price of 31 cents per share
- Keytone is also offering eligible shareholder the chance to participate in a share purchase plan to raise an extra $2.5 million
- Under the purchase plan, shareholders will have the opportunity to purchase up to $15,000 worth of shares
- Money raised from both the placement and share purchase plan will be used to accelerate growth initiatives, provide working capital, and provide funding for strategic acquisition opportunities
- Keytone has dropped 7.14 per cent on the market and shares are trading for 32.5 cents each
Keytone Dairy (KTD) has received binding commitments for a $12.5 million placement.
The company will issue approximately 40.3 million shares to institutional and sophisticated investors at a price of 31 cents per share.
This amount is an 11.4 per cent discount to the last closing price and a 19.4 per cent discount to the five-day volume-weighted average price of company shares.
The shares are expected to settle on May 13 and they can begin trading on the ASX on May 14.
Keytone will use the money to accelerate its growth initiatives, working capital, and funding for strategic acquisition opportunities.
"Demand for the placement was in excess of $12.5 million, and has been exceptionally well-supported by both new and existing institutional and sophisticated investors," CEO Danny Rotman said.
"The company is strongly encouraged by the significant level of institutional support and positive feedback received on the company's health and wellness strategy including the endorsement of its proposed name change to Halo Food Co. Limited," he said.
As well as the placement, Keytone will also offer eligible shareholders the opportunity to participate in a share purchase plan to raise an additional $2.5 million.
Shareholders will be able to purchase up to $15,000 and shares will also be issued at 31 cents each.
Keytone has the right to increase the size of the share purchase plan or scale it back.
Money raised from the share purchase plan will be used to fund sales and marketing for products, working capital, and provide capital expenditure for the acquisition of AusConfec.
The share purchase plan is expected to open on May 12, close on May 25, and allocate shares on May 29.
Acquisition of AusConfec
Keytone's subsidiary, Omniblend, has entered a binding conditional agreement to purchase the assets of AusConfec for $2.25 million.
This acquisition will finalise Keytone's fully diverse manufacturing operations across powders, protein bars, and protein drinks.
However, Keytone will only feel the positive financial effects of this acquisition in the 2021 financial year.
Keytone has dropped 7.14 per cent on the market and shares are trading for 32.5 cents each at 11:52 am AEST.