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Redbubble (ASX: RBL) has raised $52 million to fund its acquisition of New York-based online retailer TeePublic.
The capital raising was completed through a combined new share placement and an institutional entitlement offer which injected $36 million and $16 million respectively.
RedBubble was founded in 2006 and has since grown to become a global online retail giant powered by more than 700,000 artists who sell designs through the platform.
Like RedBubble, TeePublic is also a marketplace which enables artists from around the world to publish and sell designs on products including t-shirts, apparel, posters, and phone cases to name a few.
During the most recent financial year, TeePublic generated pro-forma revenue of $25.5 million and a pro-forma profit of $10 million.
CEO and managing director of RedBubble Barry Newstead says the acquisition of TeePublic will allow the company to access a wider international market and boost its digital platform.
"The success of the capital raising supports the strategic rationale for the TeePublic acquisition, providing the opportunity to accelerate our marketplace flywheel and emerge as the platform with significant scale to disrupt mainstream retail commerce," says Newstead.
"We are extremely pleased with the level of support received from existing shareholders and welcome a number of new domestic and international institutional investors to the register."
RedBubble plans to grow the TeePublic business under its own brand and it will continue to be run by Adam Schwartz, its co-founder and current chief operating officer.
While Redbubble's largest shareholder Martin Hosking opted out of buying any new shares under the entitlement offer, he will instead sub-underwrite up to $3 million of new shares under the upcoming retail component of the capital raise.
The retail entitlement offer (REO) is expected to open next Wednesday 31 October and run until 14 November. It is estimated that the REO will raise a further $8.4 million.
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