Freedom Meals – recapitalisation plan revealed
Australia-based Freedom Meals Group has introduced a recapitalisation of as much as AUD265m (US$203.3m) as a part of its turnaround technique.
It has additionally introduced Michael Perich, who has been interim CEO on the firm since August, has been given the job on a everlasting foundation, efficient instantly.
Freedom Meals, which has had a troubled 18 months amid scrutiny over its accounting, government departures and asset disposals, stated the recapitalisation will enable it to “considerably repay its financial institution debt, offering a versatile capital construction that higher facilitates the continued monetary and operational turnaround of the corporate”.
The capital-raising contains a suggestion of unlisted, subordinated secured convertible notes to eligible wholesale buyers of as much as AUD130m and an AUD200m dedication to subscribe for notes secured from its majority shareholder, Arrovest, the funding car of the Perich household – a money injection agreed in precept again in January.
Banks NAB and HSBC will present a brand new two-year, AUD36m facility to the corporate, together with a two-year time period debt facility for as much as AUD50m, relying on the whole observe proceeds raised.
The completion of the recapitalisation is focused for Might,
Freedom Meals chair Genevieve Gregor stated “This recapitalisation is a vital step within the operational and monetary turnaround of Freedom Meals Group.”
She added: “Operationally, we now have introduced the sale of sure non-core belongings and adopted a simplified enterprise technique to make sure we’re centered on the manufacturers and merchandise with the best potential in our dairy and nutritionals and plant-based drinks companies.
“Our first-half monetary outcomes, launched final month, show that we’re making good early progress on the turnaround.”
On the appointment of recent everlasting CEO Perich, Gregor stated: “Since taking over the position of interim CEO at a difficult time, Michael has offered much-needed stability and management to the corporate and its individuals. He has been on the forefront of the operational and monetary enhancements throughout the enterprise and the board is delighted he’ll tackle the position on a everlasting foundation to proceed to drive the turnaround now nicely underway.”
Earlier this month, Freedom Meals stated its turnaround plan is “starting to achieve traction” after seeing gross sales rise and losses decline within the first half of its monetary yr.
The corporate behind Australia’s Personal milk and Important Energy protein powders booked a ten% improve in income to AUD317.3m for the six months to the tip of December.
In December, Freedom Meals agreed to promote its cereal and snacks enterprise to Australian snacks maker The Arnott’s Group.
The outcomes from Freedom Meals’ prior fiscal yr have been restated after a Deloitte investigation into accounting on the firm. The overview, which additionally led to Freedom Meals’ 2018 and 2019 monetary accounts being restated, adopted information final June the corporate was probing the potential of fraudulent exercise within the wake of write-downs, prices which adopted the departure of senior executives.
Buying and selling within the listed firm’s shares has been on maintain since final June however resumed buying and selling on the Australian Securities Trade (ASX) on Monday (22 March), In early commerce, the diversified meals firm’s shares have been down 94% to AUD0.18 however that they had recovered by the tip of Tuesday to AUD0.58.