(Alliance News) - MySale Group PLC on Tuesday said it has raised at least GBP11.2 million before expenses through a share placing.
In announcing the placing earlier Tuesday, the online retailer said the new equity would enable it to repay its bank debt, meaning that it will operate on a debt-free basis, improving cash flow. The fundraising also will support the restructuring of MySale into an Australia and New Zealand-focused retail marketplace platform - what it calls its "ANZ First" strategy.
Some 79% of MySale shareholders have supported the placing of 560.5 million shares at a price of 2 pence each.
The placing price represents a discount of 58% to the closing price of 4.75 pence on Monday. On Tuesday afternoon, MySale shares were trading 37% lower in London at 3.00p each, giving it a market capitalisation of GBP4.6 million.
Executive Vice-Chair Jamie Jackson and Chief Executive Carl Jackson both participated in the placing, MySale said.
The chief executive subscribed for 100.0 million shares at a total price of GBP2.0 million. He now has a 15% stake in the company, holding 103.7 million shares.
The executive vice-chair subscribed for 10.0 million shares in the placing for a total price of GBP200,000. He now has an 8% stake in the company, holding 57.5 million shares.
"During the last 12 months the MySale business has contended with a series of significant challenges, particularly in its core Australian market," noted Chief Executive Jackson.
"The future offers significant opportunities which we will be well placed to capitalise on. We will be debt free and expect to be cash flow positive," added Jackson.
On Tuesday morning, MySale said Executive Vice-Chair Jackson has decided to step down after the forthcoming general meeting.
Therefore, the company said it intends to strengthen the board with the appointment of three new additional non-executive and executive directors, including a chief financial officer.