Melodiol Global Health Limited Secures $1.1M in New Capital to Fuel Growth
MELODIOL GLOBAL HEALTH LIMITED (ME1) Share Update July 2024 Monday 29th
Melodiol Global Health Raises $1.1M in New Capital
Melodiol Global Health Limited (ASX:ME1) has announced a significant capital raise of $1.1 million, combining equity placement and loan funding to support its growth initiatives and corporate costs.
Instant Summary:
- $1.1 million raised through equity placement and loans.
- Equity placement raised approximately $530,000 through the issue of 181,683,449 new shares.
- New Options with a term of 5 years and a strike price of $0.005 will be issued to placement participants.
- Loan funding of $600,000 drawn from a $2,000,000 facility with a 20% interest rate.
- Company's H1 2024 revenues increased by 33% to $9.3 million compared to H1 2023.
Capital Raise Details
Melodiol Global Health Limited has successfully raised $1.1 million in new capital through a combination of equity placement and loans. The equity placement has secured firm commitments to raise approximately $530,000 before costs, through the issuance of 181,683,449 new shares at a placement price of $0.00292 per share. The funds raised will be allocated towards business unit growth opportunities, corporate costs, and the costs associated with the placement.
Participants in the placement will receive one free attaching option ('New Option') for every new share issued. These New Options will have a term of 5 years and a strike price of $0.005. The company will seek quotation of the New Options on the ASX. This follows shareholder approval received at the Annual General Meeting on 31 May 2024, allowing the company to conduct placements of shares to raise up to $3 million at a 30% discount to the 10-day volume-weighted average price (VWAP).
Loan Funding
In addition to the equity placement, Melodiol has drawn down $600,000 from a $2,000,000 loan facility that was approved by shareholders at the Annual General Meeting. The loan accrues interest at a rate of 20% per annum and may be converted at a 30% discount to the company's 20-day VWAP prior to the date LTC elects to exercise its conversion right. The loan includes an establishment fee of $100,000, deferred for 60 days, and $200,000 payable in shares at an issue price equal to the 10-day VWAP prior to the date the first monies are advanced.
Revenue Growth
Melodiol's unaudited H1 2024 revenues reached $9.3 million, marking a 33% increase compared to H1 2023. This growth highlights the company's strong performance and the quality of its assets. The company has also announced a non-binding letter of intent (LOI) for the sale of a core asset for $12 million in initial cash consideration, further demonstrating the value within its portfolio.
Management Commentary
CEO and Managing Director, Mr. William Lay, expressed gratitude for the continued support of the investor base and highlighted the company's revenue growth and the quality of its assets. He emphasized the company's commitment to providing further updates in due course.
The successful capital raise and significant revenue growth are likely to positively impact Melodiol's stock price. The additional funds will support the company's growth initiatives and corporate costs, potentially leading to further revenue increases. The issuance of New Options provides an attractive incentive for investors, and the loan facility offers additional financial flexibility.
Investor Reaction:
Analysts are expected to view the capital raise and revenue growth favorably, as they demonstrate the company's ability to secure funding and achieve significant financial performance. The issuance of New Options and the loan facility's terms may also be seen as positive indicators of the company's strategic planning and financial management.
Conclusion:
Investors should keep an eye on Melodiol Global Health's future updates and assess the potential long-term impacts of the capital raise and revenue growth on their portfolios. The company's strategic initiatives and financial performance will be crucial in maintaining investor confidence and driving further growth.