IVE Group (ASX:IGL) launches $20m capital raise

• Tech marketing company IVE Group (IGL) is planning to pocket $20 million through an institutional placement and share purchase plan (SPP)
• Under the placement, the company will issue eight million shares to investors at $2.25 each to raise $18 million
• Once this is complete, eligible shareholders may apply for up to $30,000 worth of new shares at the same price to raise the remaining $2 million under the SPP
• The company plans to use the money for any future acquisitions, to maintain a healthy balance sheet and to strengthen its institutional shareholder base
• IVE Group shares are down 3.78 per cent to $2.29 at 1:04 pm AEST

IVE Group (IGL) has announced plans to raise $20 million through an institutional placement and share purchase plan (SPP).

This capital raise follows the acquisition of printing company Ovato on September 14. IVE Group completed the $16 million purchase to strengthen its tier-one customer base and support its national letterbox distribution network.

In today’s announcement, IVE Group said the integration of Ovato and associated capital expenditure costs were estimated to be roughly $22 million and would be incurred over an 18-month integration period.

Under the fully underwritten placement, IVE will issue eight million shares to professional and sophisticated investors to raise $18 million.

The shares will be issued at $2.25 each, representing a 5.5 per cent discount to the company’s closing price of $2.38 on Friday, September 16.

IVE said it had already completed the placement and expected the new shares under the placement to settle on Tuesday, September 27.

The company will then offer existing eligible shareholders the opportunity to participate in the non-underwritten SPP to raise $2 million.

Each shareholder may subscribe for up to $30,000 worth of shares at the same price as the placement between Thursday, September 29 and Tuesday, October 11.

IVE will use the money for potential future acquisitions, to preserve its balance sheet capacity, and strengthen its institutional shareholder base.

Company shares were down 3.78 per cent to $2.29 at 1:04 pm AEST.