Flooring distributor Likewise has issued new shares to raise capital as it looks to significantly increase capacity.
Existing institutional shareholder Onward Opportunities has injected £1.4m in return for 5.5million shares, after being unable to purchase shares on the market. The new shares are the equivalent of 2.19% of the group’s now increases share total. Onward paid 25p a share.
‘The board has taken the opportunity to create additional capital for the future development of the group. As previously communicated, it is intended to fund the impending Newport extension from internal cash flow, however the board is actively considering further initiatives to meaningfully increase the operational capability and enabling sales revenue to exceed £250m. Therefore, this new capital will be retained in an investment account and not absorbed into the group’s working capital cycles. We thank Laurence Hulse and the Team at Onward Opportunities for its ongoing support,’ says Tony Brewer, Likewise chief executive.
‘Onward Opportunities first invested in Likewise a year ago at 14p, having spotted some emerging competitive advantages, and that these were driving increased profitability and market share gains. This year, those advantages appear to be intensifying with associated revenue and profit gains in spite of a tough market backdrop, leading Onward Opportunities to increase its investment further into the company. As Onward Opportunities is one of the few UK funds with fund inflows this year, it can provide growth capital directly into the company to accelerate some of Likewise’ competitive advantages. This is the sort of capital allocation function that public markets can so ably provide,’ says Laurence Hulse, Onward Opportunities lead fund manager.
