Oldtown ... Dec12

The management would refocus on growing its business, after completing a private placement exercise which raised RM64 million.

The exercise, floating 33 million new shares which constitute about 10 per cent of the company's total shares at RM1.95 each, would strengthen the cafe outlet chain operator's financial position to undertake earnings accretive expansion going forward.

Estimate that Oldtown's net cash in the third quarter calendar year 2012 (post placement and ex-proposed dividend) amounted to RM107 million.

Alliance said that according to the management, approximately 70 per cent of the fund raised or RM45 million, would be used for capital expenditure (RM35 million) and an additional marketing budget (RM10 million), while the rest is for working capital needs.