Freelancer Limited (ASX:FLN) has successfully completed a $10m placement to global and domestic institutional investors. The proceeds from the raising will be used to take advantage of near term growth opportunities, acquisitions and stimulating organic growth according to the announcement issued to the ASX.
Freelancer entered a trading halt on Monday announcing the potential capital raising and will commence trading today at market open.
The new shares were issued at $1.40 which is a 5.4% discount compared to FLN’s closing price of $1.48. The considerable high price highlights the strong interest of high quality institutional investors. The selldown increased the free float to 23% while venture capital investor Simon Clausen and CEO Matt Barrie will hold 34% and 42% respectively following the transaction.
Founder and CEO Matt Barrie is pleased with the raising and said that even though he is 100% committed to Freelancer he understands the need to sell a small proportion of his own shares in order to increase trading liquidity. He said, “The $10m placement proceeds received by the company will enable us to continue investing in the business to fuel its rapid growth. We are also pleased that Freelancer is now generating positive operating cash flows.”
Wise-owl pick Freelancer has had a fantastic year so far and experienced exceptional growth. The share price has gained 127% so far this year as the company enters the next growth stage of the business.
Last week Freelancer released record results for 1H15 as revenue increased 41% to 16.8m and gross payment volume growth of 30% compared to the previous corresponding period. For the first time the company had positive operating cashflow of $1.1m for the period.
Wise-owl will continue to monitor Freelancer and update our subscribers in due course about any changes in relation to our recommendation or valuation of the company.
Author: Simon Herrmann
Aug 05, 2015
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.