Why Did ARC Funds Sell $2.15m Ausbiz Notes and Raise $738k Now?
ARC Funds Limited reported a solid $530 million in funds under management for its Term Deposit Shop platform, while strategically selling Ausbiz TV convertible notes and completing a $738,000 capital raise to bolster its balance sheet and fuel growth.
- Term Deposit Shop reaches over $530 million funds under management
- Sale of Ausbiz TV convertible notes for $500,000 cash post-quarter
- Capital raise of $737,750 via share placement with attached call options
- Operating cash flow negative but financing activities provide strong inflow
- ARC maintains support for Ausbiz Group despite note sale
Strong Year-End for Term Deposit Shop
ARC Funds Limited (ASX – ARC) closed 2025 with its online cash management platform, Term Deposit Shop, managing over $530 million in funds under management (FUM). This milestone reflects steady support from long-term clients and recurring revenue streams, underscoring the platform’s growing footprint in the competitive cash management space.
Strategic Shift in Ausbiz TV Investment
In a notable move, ARC acquired convertible notes in Ausbiz TV Pty Ltd valued at $2.15 million in November 2025. However, shortly after the quarter ended, ARC sold these notes for $500,000 in cash, effective 23 March 2026. This transaction is aimed at strengthening ARC’s balance sheet and freeing capital for future growth initiatives. Importantly, this sale does not affect ARC’s existing investments in Ausbiz Capital or its secured debt in Ausbiz Group Pty Ltd, with ARC reaffirming its ongoing partnership and support for Ausbiz.
Capital Raise to Support Growth and Working Capital
ARC successfully completed a capital raise in December 2025, securing approximately $738,000 before costs through a share placement. The issue involved nearly 5.9 million new shares priced at 11.5 cents each, accompanied by one-for-one unlisted call options exercisable at the same price. The company expects to receive the final tranche of $100,000 shortly, which will complete the placement. These funds are earmarked to bolster working capital, strengthen the balance sheet, and support future growth opportunities.
Cash Flow and Financial Position
The quarterly cash flow report reveals a negative net cash flow from operating activities, reflecting ongoing investment in business development and operational costs. However, this was offset by positive net cash inflows from financing activities, including the recent capital raise. ARC ended the quarter with $1.07 million in cash and cash equivalents, a significant increase from $290,000 at the previous quarter’s end, providing a runway of approximately four quarters based on current cash burn rates.
Looking Ahead
ARC Funds is navigating a period of strategic repositioning, balancing investment in its core Term Deposit Shop platform with prudent capital management. The sale of Ausbiz TV notes and the successful capital raise demonstrate a focus on financial flexibility and growth readiness. Investors will be watching closely to see how ARC deploys its strengthened balance sheet to capitalize on market opportunities in 2026.
Bottom Line?
ARC’s strategic capital moves set the stage for growth, but execution will be key in the coming quarters.
Questions in the middle?
- What is ARC’s long-term strategy for its relationship with Ausbiz following the note sale?
- How will ARC deploy the raised capital to accelerate growth in Term Deposit Shop?
- Can ARC improve operating cash flow to reduce reliance on financing activities?
