- Fish farmer Huon Aquaculture Group (HUO) has raised $64 million through a fully underwritten institutional placement
- A total of 21.3 million new fully paid ordinary shares were issued to institutional and sophisticated investors at $3
- Due to a challenging year, the company spent $64.3 million which was mainly funded from renegotiated debt facilities
- This led to net debt increasing 69 per cent
- Huon Aquaculture will use the funds to reduce net debt and strengthen its balance sheet and liquidity position
- Additionally, Huon hopes to raise up to $4 million through a share purchase plan to eligible shareholders
- Company shares closed 5.85 per cent in the red to trade for $3.06
Fish farmer Huon Aquaculture Group (HUO) has successfully completed a $64 million fully underwritten institutional placement.
A total of 21.3 million new fully paid ordinary shares were issued to institutional and sophisticated investors at $3 per new share.
The placement reportedly generated significant interest from Huon’s existing shareholders as well as a number of new investors.
Huon Aquaculture will use the funds to reduce net debt and strengthen its balance sheet and liquidity position. This will ensure the sea farmer is well-positioned to meet the necessary capital requirements for the next 12 months.
Unfortunately, the company faced a number of challenges in the 2020 financial year. This includes, but isn’t limited to, fish mortalities and a moon jellyfish boom.
Over FY20, Huon spent $64.3 million in the second of a two-year $150 million capital expenditure program aimed at developing the infrastructure to support production expansion over the next three to five years.
The majority of funds came from recently renegotiated debt facilities, resulting in net debt increasing 69 per cent on the prior corresponding period to $138.8 million and gearing rising to 44 per cent.
The placement is expected to be settled on September 1 and shares will be issued and commence trading on the following day.
Additionally, Huon will offer eligible shareholders the opportunity to participate in a non-underwritten share purchase plan (SPP) to raise up to $4 million.
The price for the share purchase plan will be less than the placement price and will represent a 2.5 per cent discount to the five-day volume-weighted average price of Huon’s shares up to, and including, the closing date of the SPP.
The SPP will close on Wednesday, September 23.
Company shares closed 5.85 per cent in the red to trade for $3.06.