UK-listed food investment vehicle S-Ventures has started a new fundraising process.
In a statement, S-Ventures said it intends to raise at least £2.5m ($3m).
The London Stock Exchange-listed company is looking for £1.25m to “accelerate progress, consolidate costs and deliver efficiencies”.
S-Ventures said it needs a further £1.25m to finance “deferred consideration”, which principally relates to its acquisition of gluten-free brand Juvela in December 2022.
According to the investor’s 2022 annual report, “a combination of factors including inflationary headwinds, higher interest costs” have resulted in its need for funding.
S-Ventures added it incurred losses from German free-from pasta and bread brand Lizza, which it bought in 2022 and filed for insolvency earlier this year.
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The firm’s portfolio includes UK-based healthy snacks brand Purely Plantain Chips and protein powder and snack bar makers Pulsin, both acquired in 2021. Plant-based meat producers Plant Punk and direct-to-consumer agency Market Rocket were also acquired in 2022.
S-Ventures said it would be reviewing its sources of capital, including debt and equity, to support the fundraise.
It added that it would focus on streamlining operations to “enhance profitability and cash generation”.
The firm’s existing market cap is £7.7m, which has resulted in “limited liquidity in the trading of shares, which can lead to higher price volatility and difficulty attracting institutional investors”.
It has also struggled to access capital markets for financing, making it difficult to support its operations and accelerate growth.
In July 2023, Stephen Argent was appointed as the firm’s new director and CFO, to assess the management of accounting and financial controls.
S-Ventures’ total gross revenues for the year ended 30 September 2023 are expected to hit at least £16.9m, a 96% increase from 2022.
Meanwhile, its net debt is predicted to be approximately £6.8m, which includes a director’s loan of £600,000.
While it still waits on an audit, S-Ventures suggests its EBITDA will be over £500,000.