- Cellmid (CDY) is hoping to tap investors for $3.8 million via a renounceable rights issue to fund its recently initiated Chinese distribution agreements
- In exchange, the company is offering existing investors two new shares for every five shares held at 7.5 cents, with one free attaching option
- The funds will help CDY distribute its hair care products in China, as set out under a 10-year agreement inked in December last year
- Should the rights issue go as planned, the company affirms it will sit with approximately $7.95 million in cash
- CDY shares are off 4.44 per cent following the announcement, trading at 8.6 cents
Cellmid (CDY) is hoping to tap investors for $3.8 million via a renounceable rights issue to fund its recently initiated Chinese distribution agreements.
The company is offering existing investors two new shares for every five shares held at 7.5 cents per share, marking a 26 per cent discount on the 30-day volume-weighted average price (VWAP).
For every two new shares issued, investors have also been promised one free attaching option with an exercise price of 18 cents and a term of two years from the date of issue.
The rights issue will be partially underwritten for $3 million by Mahe Capital which includes sub-underwriting by Non-Executive Director Dennis Eck for $388,878.
Funds will progress CDY’s new shipping deals after the company signed a 10-year Chinese distribution agreement back in December. The agreement is hoped to provide new market opportunities for the company’s consumer health products and working capital.
Should the rights issue go as planned, the company affirms it will sit with approximately $7.95 million in cash, which is set to increase sales of its consumer health products into China under the new agreements.
Cellmid’s anti-aging hair care brands are currently sold in Australia, Japan, U.S., China, Germany and the U.K. under the evolis, Jo-Ju and Lexilis brands.
CDY shares are off 4.44 per cent following the announcement, trading at 8.6 cents at 12:41 pm AEDT.