LONDON (Alliance News) - Koovs PLC on Tuesday said it has reached a binding agreement with Future Lifestyle Fashions Ltd under which it will receive a GBP10.5 million investment.
Shares in the Indian online fashion website were trading down 1.2% at 8.55 pence each following the news.
Under the deal, Future Lifestyle, which is part of India's largest retail group Future Group, will invest GBP10.5 million at an average 15 pence per share in two tranches.
The first tranche will see Future Lifestyle inject GBP3.7 million at 8 pence per share, for a total subscription of 45.8 million shares. After the first tranche, Future Lifestyle will hold 103.7 million shares in Koovs, a 25.8% stake.
The second tranche is conditional upon shareholder approval with Future Lifestyle subscribing for another GBP6.8 million for 24.0 million compulsorily convertible preference shares. The implied investment price is approximately 28.36 pence per new share.
Turning to operations, Koovs said that for the year ended March 31, the company gross order value fell stood at GBP12.8 million compared to GBP14.8 million a year prior.
Trading margin rose to 18% from 14% in financial 2018, while web traffic jumped 50% to 75.9 million.
Chief Executive Officer Mary Turner said: "The external factors that disrupted our business are now firmly behind us. We have deployed the funds raised in 2018 to resume marketing activities and expand the product range - this was the driving force behind the growth in sales and trading margin experienced in the second half of the year."
She added: "We are now building on this positive momentum and are starting to deliver the growth we always believed the company is capable of."
