- Cobram Estate Olives (CBO) announces a $50 million capital raise to support growth strategies in Australia and the United States
- The company will issue 25 million new shares through a placement at $2 each, a 1.5 per cent discount to Cobram’s last closing price
- Cobram is also planning to raise a further $1 million in a share purchase plan (SPP)
- Funds will be used to support its Boort Olive Mill upgrade and grove development in the US
- On the market, Cobram shares will be paused until Tuesday, December 7, and last traded at $2.03 per share.
Cobram Estate Olives (CBO) has announced a $50 million capital raise to support growth strategies in Australia and the United States.
The capital raise will see the company issue 25 million new shares through a placement at $2 each, a 1.5 per cent discount to Cobram’s last closing price.
Cobram is also planning to raise a further $1 million in a share purchase plan (SPP).
Under the SPP, eligible shareholders will be able to purchase up to $30,000 worth of shares at the same price as the placement.
Funds will be used to support its Boort Olive Mill upgrade and grove development in the US.
Boort Olive Mill
CBO’s olive processing facility at its Boort grove in Victoria has a current capacity of about five million litres per annum and is operating at close to full capacity.
Over the next nine years, the mature groves at Boort will grow from 987 hectares to 3481 hectares, an increase of 253 per cent.
The additional fruit that will need to be processed in the coming years will exceed the current capacity of the mill.
Funds raised will be used to increase the olive milling capacity at Boort from 30 tonnes of fruit per hour to 80 tonnes per hour.
Grove Development
CBO is aiming to replicate its successful Australian business in the US.
Funds from the raise will be used to buy land, trees and the development of new olive groves in California.
The company is continuing to look at other land and development opportunities and has a strong pipeline of properties under review. Increasing the supply of Californian produced olive oil will allow the company to drive packaged goods sales at retail.
Cobram’s Chair and Co-Founder Rob McGavin said the funds will allow the company to speed up these growth strategies.
“Over time, the USA offers tremendous opportunities for us to replicate the success of our Australian business, with further development of our grove acreage in California needed to support the strong growth of our USA packaged good sales, in particular through our Cobram Estate® California range,” he said.
“Additionally, the expansion of the Boort olive mill in Australia will almost triple our olive processing capacity at that site, allowing us to match the forecast medium term fruit supply growth at that site.”
On the market, Cobram shares will be paused until Tuesday, December 7, while it undertakes the placement.
Company shares last traded at $2.03 per share.