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Women's fashion retailer City Chic Collective (ASX: CCX) has seen strong demand for its share purchase plan (SPP), and in response has increased it from $10 million to around $31.1 million.
The tripling of the SPP follows the completion of an $80 million institutional placement, bringing the total raised by the company to $111.1 million.
The funds were raised for the potential acquisition of the e-commerce assets of Catherines, a US-based plus-sized fashion brand that recently filed for Chapter 11 Bankruptcy.
Approximately 10.2 million new fully paid shares in CCX will be issued under the SPP at a price of $3.05 the same price investors paid under the $80 million placement.
SPP shares will rank equally with CCX's existing fully paid ordinary shares.
CCX's deal to acquire Catherines' e-commerce assets, worth $16 million, is not set in stone and is subject to the Australian retailer being successful in a bidding process.
Post-acquisition, the remainder of the $111.1 million will go toward the company's future growth opportunities and financial flexibility.
In late-July CCX provided a trading update, showing an increase to FY20 sales revenue of 31 per cent to $194.5 million.
However, actual sales for FY20 fell by 4.8 per cent in FY20 in the Australian and New Zealand markets.
US online websites (City Chic USA, Avenue and Hips and Curves) contributed sales of $65.2 million in FY20, compared to $10.7 million in FY19, largely driven by the expanded customer base from its acquisition of Avenue.
The company had received $3.7 million in JobKeeper wage subsidies as of 24 June, with more than half of the payments made to team members due to store closures and top-up amounts above actual hours worked.
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Business News Australia
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