Tasmanian salmon farmer, Tassal Group (TGR) said on Wednesday it has successfully completed a $67.2 million equity raising.
Tassal said the placement, which was only offered to institutional investors, was oversubscribed and priced at $3.85 per share – a 3.75% discount to the prior close.
This will result in the issue of about 17.5 million new shares which will rank equally with existing ordinary shares.
The Hobart-based group plans to use the funds to reduce its debt position, to fund the recently announced acquisition of Superior Gold and to fund organic growth strategies.
"We believe the successful execution is a strong endorsement of Tassal and our stated strategy," chief executive officer Mark Ryan said.
A trading halt took place on Tuesday in light of the announcement and resumed today at 10am, with the price falling 10 cents to $3.90 by early afternoon.
As the placement was only offered to institutional members, Tassal intends to offer existing shareholders the opportunity to participate in a share purchase plan on completion of the acquisition, capped at $6 million.
On New Year's Eve, Tassal said it entered into a deal to acquire the brand name, assets and intellectual property of Superior Gold from King Island Company, a wholly owned subsidiary of National Food Limited, for $26.5 million in cash.
Superior Gold produces pre-packaged smoked salmon and trout which are sold through supermarkets and retail outlets throughout Australia.
Tassal produces and markets Atlantic Salmon and ocean trout. The product is marketed under the Royal Tasman Salmon brand and distributed in Australia, Japan and other international markets.
The group has grown since its listing in 2003 at a price of 50 cents a share and 62 million shares on offer.
That's a market capitalisation of $31 million under the initial public listing, compared to current market cap of about $460 million. The number of shares has also increased since the listing to about 116 million prior to today's issue of 17.5 million more ordinary shares.