July 11 (SeeNews) - Croatian textile company Varteks [ZSE:VART] said it is inviting potential investors to show interest in a planned capital hike intended to support liquidity needs.
Varteks plans to issue up to 1,026,671 new shares, which equals 25% of the existing 4,106,686 stocks of 10 kuna ($1.52/1.35 euro) in par value each, the company said in a filing with the Zagreb bourse on Wednesday.
The company will take a decision on the elements of the new issue, including the share price, after it evaluates the investor interest.
Interested investors should provide the overall amount they plan to invest and the amount per share, considering the share's nominal value is 10 kuna. They should sent their letters of interest within seven days after the announcement.
Varteks will give up the plan if the overall interest of potential investors is lower than 10 million kuna, or if the offered price per share is less than 16.9 kuna, which is the stock's average price in Zagreb in the past three months.
Varteks shares closed 6.36% lower at 20.6 kuna on Wednesday.
Varteks said in a separate statement on Wednesday that insufficient liquidity remains its biggest problem, adding it believes the new share issue will meet its liquidity needs. It needs fresh funds to finance maturing liabilities and working capital.
The company also said it expects to reduce its after-tax loss to 100,000 kuna this year from 24 million kuna in 2018 thanks to an anticipated rise of 60% in retail sales revenue. The projection is supported by the already evident annual increases of 90% and 92%, respectively, in retail sales revenue in the first and second quarter of 2019.
Varteks, Croatia’s leading garment manufacturing and sales company, was founded in 1918. Its own brands include Phillipe Vartin, Luis Fabre, Edora, Focus, Varteks International, and Di Caprio.
(1 euro = 7.39395 kuna)