DonkeyRepublic Holding A/S intends to carry out a private placement
Company announcement No. 14 – 2023
*Contains inside information*
DonkeyRepublic Holding A/S intends to carry out a private placement of new shares against cash contribution at a subscription price of DKK 5.79 per share, raising gross proceeds of DKK 18.6M.
The intended private placement of new shares is committed by two lead investors who will both have above 10% of shares after the private placement. In addition to the lead investors, the private placement is also supported by the CEO of Donkey Republic, Niels Henrik Rasmussen and the main shareholder EIFO - The Export and Investment Fund of Denmark as participants. The share price for the private placement will be DKK 5.79, corresponding to the average trading price during the 5 day trading period 26 - 30 June 2023, with no discount applied to it. 3.2M new shares will be issued if the private placement comes through.
As disclosed in company announcement No. 13 - 2023 Donkey Republic would assess funding to support further growth, and this is now being executed. Donkey Republic is experiencing a high demand for its bike sharing solutions in its core markets, due to its good value proposition to cities who are looking for an affordable, flexible and sustainable bike sharing scheme for their citizens. This has given the company several realistic opportunities of onboarding new long term subsidized city contracts. These contracts will be directly contributing to the positive EBT of the company and also have a positive operating cash flow. This will also set up the company for a profitable growth path beyond 2024. The capital raise is now aimed primarily at giving Donkey Republic the possibility to provide the necessary capital for onboarding new long term contracts.
The capital raise and onboarding of new long term contracts is expected to strengthen the position of the company in three ways
- Delivering on revenue and profitability target for 2024 and its profitable growth in the years beyond
- Improve the balance sheet of the company by improving debt/equity ratio and therefore improving long term outlook to onboard capital for growth in 2024 and beyond
- Strengthen future cash flow coming from operations
“The intent of doing a capital raise is for further development of the company and to capture the demand we are currently experiencing. We have in the past year rolled out several cities on long term contracts, this supports our vision of working with cities to create a better place for living, but it also supports our business as we are able to secure long term contracts with long term revenues. That is why when the right opportunities arise we will like to pursue them, as it contributes with high value for the company both in terms of financials but also in terms of strategic market position in key markets, this capital raise will put us in that position ” says CEO Niels Henrik Rasmussen.
The capital raise is therefore in accordance with and part of the execution of the outlined strategy presented in the company announcement No. 08 - 2023, but also lays the groundwork for next level growth beyond 2024. The guidance for both 2023 and 2024 remains unchanged, however this movement confirms that the company is on a strong growth path, which will also lead to positive EBT in 2024.
The Private Placement is subject to approval by the Company’s general meeting and the board will by separate announcement call for an extraordinary general meeting asking for authorisation to the board to carry out the capital increase for the Private Placement. The extraordinary general meeting will be held on Thursday 20 July 2023 at 15:00.
Subject to approval and completion of the Private Placement the share capital of the Company will be nominally DKK 2,070,127.6 divided into shares of nominally DKK 0.10 each.
