Join our daily newsletter At The Bell to receive exclusive market insights
- Wattle Health Australia (WHA) has requested Computershare refund all application money subscribed by investors for its rights issue offer
- The rights issue was launched in November last year to raise up to $62 million for an increased stake in Blend and Pack
- Unfortunately, however, the raise was over $50 million short and Wattle pocketed a mere $12 million
- The infant formula producer expects to refund investors by January 24th and will launch a new rights issue offer
- Shares in Wattle were voluntarily suspended late last year and are yet to reopen
Wattle Health Australia (WHA) has requested Computershare to refund all application money subscribed for the non-renounceable rights issue offer.
These refunds are expected to be paid back to investors on or around Friday January 24 2020.
This four-for-five rights issue was launched in November last year to raise up to $62.2 million at an issue price of 40 cents per new share.
The infant formula company intended to increase its five per cent stake in Blend and Pack (B&P) to 80 per cent.
Unfortunately its raise was over $50 million short and Wattle walked away with a mere $12 million.
After the raise tanked, Wattle Health stated it’ll come up with an alternate arrangement or extension with Mason Financial Holdings – the current owner of B&P.
On January 13, the company released an announcement on the negotiations with Mason since the disappointment of the capital raise.
The parties signed a deed of amendment and restatement amending the original share purchase agreement.
Wattle Health will still aim to increase its stake in B&P by 75 per cent subject to shareholder approval and must be settled by February 29 2020.
The Board considers this new structure to be a better commercial outcome for its shareholders as it is still valued at US$55 million (A$80 million), but requires much less upfront cash payment as Mason now agrees to take equity for a portion of the upfront payment.
Wattle will launch its new rights issue offer with details to be included in a new booklet.
Shares in Wattle were voluntarily suspended late last year and are yet to reopen.
