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Cirralto raises $2.7 million to grow its Spenda business payments service

Funds raised will be used to support growth, additional payments product development, debt reduction, marketing, costs associated with the completion of the acquisition of Appstablishment and general working capital.

Comet Resources Ltd - Cirralto raises $2.7 million to grow its Spenda business payments service
Canary Capital and CPS Capital acted as joint lead managers to the issue

Cirralto Ltd (ASX:CRO) has raised $2.7 million through an oversubscribed placement to institutional and sophisticated investors, designed to grow the Spenda business payments service in line with CRO's transition to a digital payments company.

The company had initially set out to raise $2 million but received strong demand from a large number of new institutional and sophisticated investors and has elected to accommodate a portion of the excess demand to raise an additional $712,000.

Demonstrating their support for Cirralto and its future operations, directors and management have subscribed for a total A$82,000 in the placement.

Funds to deliver debt-free balance sheet

Managing director Adrian Floate said: "The strong demand for this capital raise was very pleasing and I feel recognition of the investors’ understanding of our payments tech and its position in the market.

“These funds coupled with the operational savings we have created by virtualising our organisation will be used to deliver a debt-free balance sheet and provide working capital for growth.

“We are focused on growing our merchant base and capturing market share - the board and I remain strongly supportive of the company as demonstrated by our participation in this placement.”

Use of funds

Funds raised will be used to support growth, additional payments product development, debt reduction, marketing, costs associated with the completion of the acquisition of Appstablishment and general working capital requirements.

Some of the new funds will be used to strengthen the company’s balance sheet and retire about A$1 million in debt and debt-related instruments, including the Obsidian Global Partners LLP Funding Facility.

Placement shares

Cirralto will issue 271.2 million shares under the placement at a price of 1 cent per share, representing a 23% discount to the previous closing price of 1.3 cents on August 7 and a 14.7% discount to the 15-day Volume Weighted Average Price.

Director participation is subject to shareholder approval at the next general meeting.

Canary Capital and CPS Capital acted as joint lead managers to the issue and will receive a fee of 6% of the amount raised and 100 million options exercisable at 2.5 cents expiring on July 28, 2023.

In addition to the placement, the company is finalising an option entitlement offer to shareholders, details of which will be announced shortly.

Quick facts: Cirralto

Price: 0.034 AUD

ASX:CRO
Market: ASX
Market Cap: $67.59 m
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