Shares in Boohoo Group PLC (AIM:DEBS), which trades as Debenhams Group, after it raised £40 million in an oversubscribed share placing, with shares rising 5% to 19p.
Strong investor demand, which exceeded £35 million, prompted an increase in the size of the fundraise.
An accelerated bookbuild was completed at 18p per share, representing a 5% discount to the closing price on 17 February.
Gross proceeds of £40 million will be used to strengthen the balance sheet and provide greater financial flexibility as the online retailer continues its multi-year turnaround.
Management said the improved capital structure would support execution of its strategy and position the business for further operational progress.
Broker Peel Hunt, repeating its 'hold' recommendation and 20p price target, said: "We look for further information regarding any adjustments to the covenants and operation of the group’s existing £175m facility, to further improve the group’s liquidity position."
Alongside the fundraising, it was announced that Iain McDonald had stepped down with immediate effect as a non-executive director and chair of the remuneration committee.
Departure follows his participation in the placing and enables investment by certain funds managed by him.
McDonald, who served on the board for nine years, said: “It has been a pleasure to be a non-executive director at Debenhams over the last nine years and I am delighted to support the company in the fundraising.”