Rhinomed (ASX:RNO) has undertaken a $2.1million private placement.
The placement was made to two US based sophisticated investor groups under ASX Listing rule 7.1 and the company’s current 15 per cent capacity.
105,135,000 shares will be issued to Mr Whitney George, a current investor, who has now increased his stake to 17.73 per cent of the company.
A further 17,000,000 shares will be issued to one other US based investor group, in both cases subject to lodgement of a cleansing prospectus by the company to facilitate secondary trading of shares issued pursuant to the placement.
The proceeds of the private placement will be used to support the company’s strategy of expanding its retail distribution footprint and driving key strategic initiatives.
The issue price of the placement is 1.8 cents per share, which represents a 6 per cent premium to Rhinomed’s closing share price of 1.7 cents on 14 March and a 16 per cent premium to its 20 day VWAP. All new placement shares will rank equally with the existing shares.
Chairman Ron Dewhurst said, “We are delighted with the strong support from our cornerstone investor. Rhinomed is steadily building a compelling proposition and an exciting brand presence in the USA. We are pleased to receive this strong vote of confidence in the company and its strategy.”