LONDON (Alliance News) - Castleton Technology PLC Tuesday said it has raised gross proceeds of GBP2.2 million through a "heavily oversubscribed" placing of 97.8 million new shares at a discounted 2.25 pence each, money it will use to strengthen its balance sheet after its recent acquisitions of Brixx and Impact.
The software and managed services provider to the public and not for profit sectors also said trading across the group is "encouraging" and its Documotive unit has just signed its first five-year software-as-a-service deal with a Yorkshire social housing association as well as an agreement with a Dutch reseller to distribute its products in the Netherlands. These will add to recurring revenue.
Castleton said it is also proposing to convert its GBP1.5 million loan facility with MXC Capital into new shares at 2 pence each, and to convert GBP1 million of loan notes with the sellers of Documotive into new shares at 1.1 pence each.
"We are delighted by the strong response from both new and existing institutional shareholders to the Placing. The recent acquisitions of Brixx and Impact have completed the initial stage of building our platform and the fundraising provides us with additional capital as we continue to integrate our products and services," Castleton Chief Executive Ian Smith said.
Castleton Technology shares were down 7.7% at 2.98 pence early Tuesday.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
Copyright 2015 Alliance News Limited. All Rights Reserved.