14th May 2019 18:13
LONDON (Alliance News) - PureCircle Ltd late Tuesday said it intends to raise funds to enable it to fully capitalise on both existing and new opportunities following a growing demand for stevia products.
The company said it intends to issue up to 17.4 million shares at a price of 280 pence each. PureCircle shares closed flat on Tuesday at 260p each, giving it a market capitalisation of GBP454.6 million.
As part of the fundraise, the stevia producer said Alwaha Fund Ltd, Halfmoon Bay Capital Ltd, Asian Investment Management Services Ltd, Portola Group Ltd, and several existing shareholders of the company have agreed to subscribe, in aggregate, for 8.8 million new shares.
In addition, the company's directors Rosemarie Andolino, John Gibney, Magomet Malsagov, Rakesh Sinha, John Slosar, Stephane Ducroux and Lai Hock Meng have agreed to subscribe for 302,377 placing shares at the same price.
PureCircle said the fundraising will give it a greater financial flexibility to undertake a number of new projects and accelerate its growth by broadening its reach and increasing penetration with its customers. The company expects the overall cost of this expansion to be USD35 million.
"This [placing] is intended to open doors to new segments of the consumer goods sector while also enabling our teams to accelerate new projects with both existing and new blue-chip brands," said Chief Executive Magomet Malsagov.
Simultaneously, PureCircle said it swung to profit of USD2,700 in the three months to the end of March compared to USD4,100 loss reported for the same period a year earlier, as revenue grew by 11% to USD80,300 from USD72,600.
Looking ahead, the company said it expects its sales to continue to grow, however full year out turn may reflect some cannibalisation of base business as PureCircle continues to drive sales of new generation products.
"Having made strong progress in the beverage industry, which has seen us create long term relationships with major brands and continues to drive good growth as seen in our third quarter numbers, we are keen to transfer this success to the food service space in the short to medium term," added Malsagov.
Finally, the company said it has renewed its supply agreement with Merisant, a producers of low- and zero-calorie table-top sweeteners. PureCircle has also entered into a new stevia supply agreement with IFF, a flavour house.
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