New Zealand Coastal Seafoods has strengthened its financial footing with a $100,000 convertible note investment from cornerstone backer Ilwella Pty Ltd, aiming to accelerate its sustainable growth plans.
- Ilwella Pty Ltd invests $100,000 via convertible notes
- Notes carry 12% interest and mature in 12 months
- Conversion price set at $0.02 per share, pending shareholder approval
- Funds to support ongoing operations and strategic initiatives
- Company emphasizes commitment to sustainable fishing practices
Convertible Note Subscription Strengthens Capital Base
New Zealand Coastal Seafoods Limited (ASX, NZS) has announced a $100,000 investment through convertible notes from its cornerstone investor, Ilwella Pty Ltd. This infusion of capital is designed to bolster the company's working capital and provide financial flexibility as it pursues its strategic objectives.
Ilwella Pty Ltd, the family office investment vehicle of Brian and Peggy Flannery, brings a diversified global investment background spanning hospitality, property development, agriculture, and natural resources. Their continued support signals confidence in NZS’s business model and growth trajectory.
Terms and Conditions of the Convertible Notes
The convertible notes have a face value of $1 each, with a total of 100,000 notes issued. They carry a 12% annual interest rate if not converted and mature in 12 months. Conversion into ordinary shares is set at $0.02 per share, subject to shareholder approval at an upcoming meeting. The notes are unsecured, and conversion can occur before maturity at the lower of the fixed conversion price or the 10-day volume weighted average price prior to conversion.
This structure offers Ilwella potential upside through equity participation while providing NZS with immediate capital without diluting shares until conversion is approved.
Strategic Implications and Sustainability Focus
Executive Chairman Peter Chai highlighted that the capital raise will enable the company to accelerate its strategic initiatives. NZS operates through its Australian arm, Nine Ocean Fishery Pty Ltd, focusing on premium seafood sourced responsibly from the Torres Strait and Coral Sea. The company prides itself on sustainable fishing practices verified by independent assessments, ensuring minimal environmental impact.
The additional funds will support ongoing operations and reinforce NZS’s commitment to environmentally responsible seafood production, a key differentiator in a competitive market.
Looking Ahead
The next critical step for NZS will be securing shareholder approval for the conversion of these notes into equity, which will determine the ultimate impact on the company’s capital structure. Investors will be watching closely for the outcome of the forthcoming shareholders’ meeting and any subsequent equity issuance.
Bottom Line?
NZ Coastal Seafoods’ latest capital raise sets the stage for growth, but shareholder approval will be pivotal in shaping its equity future.
Questions in the middle?
- Will shareholders approve the conversion of the notes, and on what terms?
- How will the potential dilution affect existing shareholders and share price?
- What specific strategic initiatives will the new funds accelerate?