MyEco Group has locked in $0.92 million through its Series 2 convertible note program, reinforcing its growth trajectory with funding earmarked for a new GRS-certified recycled bin liner range. The raise supplements a solid cash position while aiming to limit shareholder dilution amid challenging market conditions.
- Convertible notes raise $0.92 million from sophisticated investors
- Notes carry 10.5% annual interest with conversion at 15% discount
- Funding supports launch of Global Recycled Standard bin liners
- Directors subscribed $150,000 pending shareholder approval
- Raise bolsters $2.6 million cash and $1 million debt facility
Convertible Note Raise Strengthens Growth Capital
MyEco Group (ASX:MCO) has successfully raised $920,000 through its Series 2 unsecured convertible note program, targeting sophisticated investors to fund expansion initiatives including its newly developed Global Recycled Standard (GRS) certified post-consumer recycled bin liner range. This fresh capital injection adds to the company's $2.6 million cash balance at the end of 2025 and its undrawn $1 million secured debt facility, underpinning its financial flexibility in a tough market environment.
Convertible Notes Offer Attractive Terms with Limited Dilution
The notes carry a 10.5% annual interest rate, paid quarterly, with a three-year term and mandatory conversion at maturity. Investors can convert principal and accrued interest into ordinary shares at a 15% discount to the 14-day volume-weighted average price (VWAP) prior to conversion, subject to a floor of 1.9 cents and a cap of 5 cents per share. Conversion can commence twelve months after issuance, providing investors flexibility while allowing MyEco to minimise immediate dilution to shareholders.
Notably, $150,000 of the notes have been subscribed by directors James Walsh, Richard Tegoni, and Don Haller Jr, pending shareholder approval, signalling insider confidence in the company’s prospects. The Board retains discretion to issue a further $1.08 million under the note deed, potentially extending the raise depending on market appetite.
Funding Supports Strategic Product Launch Amid Operational Momentum
This capital raise complements MyEco’s recent operational progress, including a 38% improvement in profit before tax and a 51% increase in normalised EBITDA for the first half of FY26, driven by sales growth and cost efficiencies. The company’s refreshed leadership and strategic priorities are positioning it for further expansion in sustainable packaging markets, as evidenced by strong demand for its MyEcoBag® products and ongoing product innovation.
MyEco’s CEO Marie de Perthuis emphasised the importance of the raise: “We are pleased to receive support for the Convertible Note issue from existing shareholders and new investors during the current challenging global market conditions. This capital will enable us to continue with growth plans whilst protecting shareholder value by minimising dilution to existing shareholders.” The raise follows the company’s earlier $2 million Series 2 convertible note offer launched in late March, demonstrating steady investor interest in the program.
Convertible Note Program Balances Capital Needs and Shareholder Interests
MyEco Group’s convertible note strategy reflects a cautious approach to capital raising in volatile markets, offering investors an attractive yield and conversion upside while preserving existing shareholders’ equity. The notes are unsecured but rank equally upon conversion with existing shares, and the company retains the right to redeem notes with notice, adding flexibility to its capital structure management.
With manufacturing facilities in China and sales offices spanning Australia, Malaysia, Mexico, and the USA, MyEco is well positioned to capitalise on the global shift towards sustainable packaging. The success of this raise will be a key factor to watch as the company ramps up production and sales of its GRS-certified recycled bin liners, a product aligned with increasing environmental regulations and consumer demand.
Bottom Line?
MyEco’s convertible note raise provides a timely capital boost to advance new sustainable products while carefully managing dilution risks.
Questions in the middle?
- Will the Board exercise discretion to issue the remaining $1.08 million under the note deed?
- How will note conversions impact MyEco’s share register and liquidity over the next three years?
- Can the GRS-certified bin liner range drive meaningful revenue growth amid competitive pressures?