Bubs Australia launches $28m raise; Bell Potter hired
Infant milk products business Bubs Australia is ready to put its boardroom drama behind it and focus on US growth.
Bubs chairwoman Katrina Rathie. Janie Barrett
Bubs had its broker, Bell Potter, launch a $28 million raising on Wednesday morning, split evenly across a placement and a share purchase plan.
The 12.5¢ a share offer price was pegged at a 24.2 per cent discount to the last close.
Fund managers were being told Bubs would use the proceeds to seek permanent access to the $8.1 billion US infant milk formula market. A term sheet sent to prospective investors said Bubs was aiming to double production under new CEO Reg Weine, seek FDA approvals and invest in marketing and sales.
Bids into the placement were due 5pm Wednesday.
It comes after, Weine – helped by corporate advisory firm Kidder Williams – led a strategic review into Bubs to appease shareholders. That in turn came amid a board spill instigated by former executive chairman Dennis Lin and former CEO Kristy Carr.
The spill was eventually voted down, but Bubs moved Weine to the top job and tasked him with the turnaround which has centres on US growth, margin expansion and China reset. Bubs shares are down 54 per cent in the past 12 months.
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