APA Financial Services (ASX:APP), to be renamed Australian Dairy Farms, has secured firm commitments of $8.5 million from new cornerstone investors, prior to launching a public offer to raise up to $14.5 million.
Upon completion of the offers and satisfying the appropriate ASX listing requirements, APP and Trustees Australia (ASX:TAU) will be an owner and operator of two producing dairy farms in South West Victoria, near Warrnambool.
Institutional investors share APP's view that there is opportunity to consolidate Australia’s fragmented dairy sector.
The capital raising will provide a strong platform to use scale via the acquisition of additional farms to deliver revenue and cost synergies, and produce 50 million litres of milk per annum within two years of listing.
Each eligible registered shareholder in APP and Trustees Australia is entitled to apply for a priority offer allocation of 10,000 stapled securities.
Shares in the company have increased 10-fold since June, yet is still capped at just $2 million.
