Powerlan raises $16m in capital

Powerlan (ASX:PWR) has announced it has raised close to $16 million through its latest renounce able rights issue of 348,744,251 shares at $0.06 a piece.

The issue, announced on 15 January, was originally to have issued 330,107,288 shares aimed at raising $19.8 million. The figure raised — $15,973,046 — was nonetheless in line with original forecasts that not less than about $16 million would be raised.

The funds will be used to repay a portion of debt owed to CPS Group Investments and the balance will ensure Powerlan retains about $6 million in working capital and acquire businesses.

The news follows the early February withdrawl of the takeover offer from Alpha Growth International (Australia). At the time, Powerlan Board said in an ASX statement that it welcomed the withdrawal given the “uncertain and highly conditional” nature of Alpha’s proposal and the confusion and uncertainty the offer created in relation Powerlan’s rights issue.

In late February, Powerlan announced its financials for the six months to 31 December 2009 during which revenue and continuing operations fell 26.7 per cent year on year to $12.5 million with a net loss of $7.5 million.