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CANNABIS INDUSTRY 

BREAKING  NEWS

Labat Seeks to Raise R74 Million From Current Shareholders Through New Rights Offer

Labat Seeks to Raise R74 Million From Current Shareholders Through New Rights Offer

JSE-listed Labat Africa is seeking to raise additional capital by offering shareholders a chance to up their stake in the game. It wants fresh capital to expand infrastructure relating to its SAHPRA extraction license at Sweet Water Aquaponics in the Eastern Cape and its healthcare business.

Cannabiz Africa

19 June 2023 at 12:00:00

Labat Africa advised shareholders on 14 June 2023 that it was seeking to raise a maximum of R74 677 505 from issuing additional shares at 12 cents a share. 


In an announcement on SENS, Labat said The Rights Offer will “strengthen the Company’s capital structure and will improve Labat’s liquidity which will set the Company on a path to pursue its strategy to significantly accelerate the expansion of its vertically integrated Healthcare business.”


The board said it would “consider the best allocation of capital to achieve the prospects in relation

to the organic expansion of Labat’s Healthcare business, particularly around the infrastructure, plant and machinery relating to the SAPHRA extraction licence. The balance of the proceeds from the Rights Offer will be used by Labat to settle expenses related to the Rights Offer and for working capital purposes, with the balance retained by the Company in an interest-bearing cash reserve account for further opportunities related to the Healthcare and hemp business.”


The company “intends to offer a total of up to 622 312 545 ordinary shares for subscription by way

of renounceable rights, at the rights offer issue price of 12 cents per ordinary share on the basis of one rights offer share for every one ordinary share held by Labat shareholders who are permitted to participate in the rights offer and are reflected in the share register of Labat at the close of trade on the record date for the Rights Offer. If fully subscribed, Labat will raise a maximum of R74 677 505 in terms of the Rights Offer.”


It says the rights offer will be partially underwritten by directors and their associates, through the

capitalisation of existing amounts owed to the related parties and that more details will be issued in due course in a circular to shareholders.

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