ASX-listed franchise consolidator Retail Food Group Limited says it has received commitments for a placement of 24 million ordinary shares at $1.85 per share to raise $44.4 million.
Participants in the placement represent a range of institutional and private investors, with all existing institutional shareholders participating in the placement.
Funds will be applied to partially fund the cash component of the consideration payable to The Michel’s Group Australia Pty Ltd, and also pay down debt associated with the recent acquisition of Brumby’s.
The placement has been made to new and existing institutional and sophisticated investors pursuant to Section 708 of the Corporations Act 2001. All of the shares issued under the placement will rank equally with existing ordinary shares.
Following completion of the issue, RFG will have approximately 97.6 million ordinary shares on issue.
Retail Food Group CEO Tony Alford said the company was extremely pleased with the level of interest in Friday’s share placement.
The company said that with the composition of the company’s capital structure now substantially determined, and assuming the Michel’s transaction is completed in the first half of the current financial year, the company’s directors remained confident that the earnings per share growth would equal or exceed 50%.
“The acquisition of Michel’s Patisserie, which will bring total store numbers under RFG’s stewardship to in excess of 1030 outlets, bodes well for the company’s shareholders and RFG is well placed to deliver further rewards to its shareholders both this financial year and subsequently”, Cowley said.
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