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Creso Pharma raises A$2.5 million, streamlines balance sheet for growth strategy

Published: 23:09 18 May 2023 EDT

Creso Pharma Ltd -

Creso Pharma Ltd (ASX:CPH, OTCQB:COPHF) will add A$2.5 million to its bank balance thanks to a share placement with institutional, professional and sophisticated investors.

The pharmaceuticals stock, which is dual listed in Australia and on the Frankfurt Stock Exchange, plans to issue nearly 205 million new shares at 1.2 cents a pop, allowing investors to capitalise on a near 24% discount to CPH’s last closing price.

In other news, Creso has chosen to convert a suite of liabilities into equity, repay convertible notes to investment management firm Obsidian Global and extend its existing secured notes with investors.

These initiatives are expected to streamline the balance sheet, giving Creso crucial capital leeway as it enters a new growth phase.

“Strong base to grow sales and revenue”

Amid the raise, Creso CEO and managing director William Lay welcomed new investors to the register and thanked the existing contingent for their continued support.

 “The new funds come at a pivotal time for Creso Pharma,” he stated.

“Following the recent completion of our acquisition of Health House International Limited (ASX:HHI), the group has a strong base to grow sales and revenue, while progressing a number of regulatory and product development initiatives to introduce new cannabis, plant-based and psychedelic solutions into rapidly growing international markets.

“Creso Pharma looks forward to providing ongoing updates in the coming months.”

EverBlu Capital acted as lead manager to Creso’s placement, entitling it to a 6% cash fee and nearly 25 million shares, priced at 12.2 cents each.

Former chairman Adam Blumenthal has committed A$900,000 under the raise, subject to shareholder approval. The remaining shares are covered under Creso’s existing placement capacity.

Finally, placement participants can also pick up a free attaching option, valued at 8 cents and exercisable before January 31, 2027.

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