Sosandar placing raises £7m, will support move to sell on third-party sites
No matter how well a company is doing, cash flow is a key issue and smaller companies need a healthy cash balance in order to grow. So it’s interesting that fast-expanding (but still small) Sosandar on Thursday announced a share placing to raise £7 million.
The online womenswear brand that targets the often-neglected 35+ age group, has raised that amount (before commissions and expenses) through a conditional institutional placing of new Ordinary Shares at a price of 15p each.
The placing price was at a 3.4% premium to the firm’s closing share price on July 10 and was “significantly oversubscribed by new and existing shareholders.”
Co-CEOs Ali Hall and Julie Lavington said of this: “We are very pleased to have successfully raised £7 million, with shareholders showing their support for the business and our growth plans. Our strong financial performance and high level of repeat orders demonstrates the demand for our products and loyalty of our existing customer base. We have considerable momentum in the business.”
And they added that "several opportunities are in the pipeline which will further improve the Sosandar shopping experience and build awareness of the brand to new customers.”
The company said that after recently reporting an annual 228% revenue rise and 224% rise in orders, “given the continued strong performance, the board believes that it is appropriate to raise additional equity to help support and accelerate further growth.”
The proceeds will now support expansion, including enabling it to pursue new opportunities. This is key as the company “is in discussions to sell on third party sites, however to work with them, the company expects it would need to stock up on selected lines and would only be paid in arrears.”
It will also be used to help “the expansion of new supplier relationships and reduce the risk of having to rely on supplier credit to fund future growth, particularly given the current supplier credit backdrop.” And it will add to the product range as well as investing more in customer acquisition.
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