Cambria Africa (LON:CMB) is raising US$4.06mln issuing new shares in an oversubscribed placing.
A regional and product roll-out strategy for both Millchem and Payserv has been developed, and Cambria says it is excited about the prospects of these investments.
Cambria will issue 33mln new shares, priced at 7.5p each to new and existing institutional investors. This is close to the maximum number of shares the company is able to issue without a shareholder vote.
Major shareholder Consilium Investment Management participated in the placing, buying almost 8mln new shares and increasing its stake to 14.69% from 9.93%.
The company’s directors and management participated in the placing also, together subscribing for 813,455 shares. So did the group’s brokers WH Ireland and Peterhouse Corporate Finance, which subscribed for 1mln and 302,000 respectively.
Broker Beaufort Securities has today begun its coverage of the AIM share with a ‘speculative buy’ and a 15p price target, which analyst Harry Stevenson says could end up being ‘conservative’ – even though is double today’s placing price.
“This is a new chapter in the life of Cambria, with many of the legacy issues resolved, the company can now focus on executing it strategy with two exciting businesses in Africa, namely Payserv and Millchem,” Stevenson said.
“It is to the company’s credit that the cost base has reduced considerably*, and with a firm focus on Payserv and Millchem, could see developments move apace. As the company has indicated, its continued investment in the two companies will begin to prove fruitful in the coming months.”