Real Good Food PLC (LON:RGD) is set to launch an open offer to raise up to £1.0mln for additional working capital, a month after agreeing terms for at least £8.2mln in new financing arrangements with its three major shareholders.
The AIM-listed food producer said qualifying shareholders can subscribe for new ordinary shares at a price of 5p each, which equates to the strike price of the proposed replacement convertible loan notes under the previously announced financing arrangements.
The group said its major shareholders - being Napier Brown Holdings, Omnicane and certain funds of Downing LLP - do not intend to take up their entitlement under the open offer.
The company added that it intends to include an excess application facility so that any ordinary shares not subscribed for by qualifying shareholders under the open offer will be available to other qualifying shareholders to subscribe for over and above their basic entitlements.
Real Good Food said the proceeds of the open offer will allow all qualifying shareholders to participate in the refinancing of the company whilst also providing the firm with additional working capital headroom.
Hugh Cawley, Real Good Food’s chief executive said: “Having recently completed our new financing arrangements with the Company's three major shareholders, the Board recognised the importance of enabling all shareholders to participate in the refinancing of the Company and is therefore intending to launch the Open Offer accordingly."
The group also said it is currently in the process of seeking to appoint two appropriately qualified and experienced candidates as independent non-executive directors.
It added that it will make further announcements when suitable candidates have been identified and have agreed to join the board in due course.
Reflecting the deeply discounted equity raise, Real Good Food dropped 31.6% lower to 6.5p in late afternoon trading.