- Translation services specialist Straker Translations (STG) has called a two-day trading halt as it kicks off the first part of a $20 million capital raise
- Straker plans to raise half the funds by way of a private placement, while the other half will be raised through an institutional and retail entitlement offer
- All new shares under the capital raise will be offered at $1.90 each, which represents an 18.5 per cent discount to STG’s last closing price
- The placement and institutional offer will be completed this week, while the retail segment of the entitlement offer will open on Wednesday, June 9
- Major investor Bailador Technology Investments, which owns 11.8 per cent of STG, has agreed to sub-underwrite any shortfall from the retail offer
- Straker said the new funds will go towards accelerating its growth strategies and paying down some debt
- Shares in Straker Translations last traded for $2.33 on Tuesday, June 1
Translation services specialist Straker Translations (STG) has called a two-day trading halt as it kicks off the first part of a $20 million capital raise.
Straker plans to raise half the funds by way of a private placement, with the other half to be raised through an institutional and retail entitlement offer.
The company said the new funds would go towards accelerating its growth strategies and paying down some debt.
Under the first part of the cap raise, Straker will raise $10 million by placing around 5.3 million shares to institutional, professional and sophisticated investors at $1.90 each. This price represents a neat 18.5 per cent discount to STG’s last closing price of $2.33 per share.
At the same time, Straker plans to launch the institutional segment of the entitlement offer, under which private investors can buy one new share for every 10.32 shares already held on a pro-rata basis. Shares will be sold under the entitlement offer at the same price as the placement.
Both the placement and institutional segment of the entitlement offer are expected to be completed before STG shares resume trading on Friday, June 4.
The retail segment will then open on Wednesday, June 9, with mum and dad investors also given the opportunity to buy one new share for every 10.32 owned at $1.90 each.
Major investor Bailador Technology Investments, of which Straker director Paul Wilson is also a director, has agreed to sub-underwrite any shortfall from the retail segment of the entitlement offer. Bailador has also flagged its plans to take up its full entitlement under the institutional segment of the offer.
Bailador currently holds an 11.8 per cent interest in Straker.
Straker offers translation services to mostly enterprise customers, using AI-based technology supported by human translators to help businesses sell their products effectively in a range of languages.
In January this year, Straker announced its US$6.47 million (around A$8.4 million) buyout of Utah-based translation company LingoTek. Some of the proceeds from the upcoming cap raise will be used to pay down the debt raised to complete this LingoTek purchase.
Shares in Straker Translations last traded for $2.33 on Tuesday, June 1. The company has a $126.7 million market cap.