Bloomsbury raises £8.4m through equity placing

Within hours of trading, Bloomsbury has raised gross proceeds of £8.4m, thanks to the completion of a share placement worth 5% of its existing share capital.

The company reported the completion of the non-pre-emptive placing of 3,766,428 ordinary shares by Investec Bank plc at 223.25p per share mid-morning on Friday (17th April).

The price 223.25p represents a discount of 5% to the mid-market closing price of 235p on 16th April 2020.

The placing shares, when issued, will be fully paid and will rank "pari passu" (on the same footing) in all respects with each other and with the existing ordinary shares of the company.

According to the statement issued, it is expected that "admission" to the the FCA's Official List and to trading on the main market for listed securities of the LSE will become effective on or before 8.00 a.m. on 21st April. Following this process, the company will have 79,094,998 ordinary shares in issue in total.

The proceeds of the equity placing are intended to provide "additional headroom to provide financial flexibility to the company to enable it to maintain appropriate investment to capitalise on future commercial opportunities, whilst ensuring it remains within its banking covenants".

In a trading update earlier, Bloomsbury also outlined a series of cost-cutting measures, anticipating that the impact of coronavirus on retail to affect print revenues. These include reducing discretionary spending (to save an average of £900k per month); a recruitment freeze and furloughing staff (to save £30k per month); and asking the majority of employees to take a pay cut for the next three months (representing additional savings of £200k per month) to help avoid redundancies. The company said it is applying for government schemes in the UK, US and Australia to support staff and businesses, also (worth £700k per month for the first two months and £100k after, if successful).