US: Galaxy Partners tightens grip on Galaxy Nutritional
Galaxy Partners has increased its control of Galaxy Nutritional Foods, taking a controlling stake in the US organic dairy firm and appointing three representatives to the company's board.
Fred DeLuca, formerly the group's biggest shareholder, sold his $2.7m convertible note and his 3.9m outstanding shares to Galaxy Partners.
Upon closing, the investment firm then converted the note into shares at the conversion price of $0.35 per share. A total of 9,941,278 new shares were issued, meaning that the marketer of cheese alternatives and natural and organic food now has 27,051,294 outstanding shares.
Galaxy Partners now holds a controlling 51.1% stake in the Galaxy Nutritional.
Three representatives of Galaxy Partners have been appointed to the company's board of directors. Timothy Krieger, Michael Slyce and David Johnson will join the company's four existing members.
"We are pleased to announce this transaction which removes a substantial short-term liability and greatly strengthens the company's balance sheet. The elimination of this debt will allow us to utilise our operating cash flow more effectively as we focus on growing the company," said CEO Michael Broll.
He added: "We look forward to working with our new majority shareholder, Galaxy Partners, as well as our new directors. We appreciate the confidence which they have shown in the long-term outlook of our company."
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