Donaco completes entitlement offer, raises $14.4m

Donaco International said it has raised A$14.4 million ($10.2 million) before costs through an entitlement offer, though investors only took up about a quarter of the available shares.

The shares were offered on the basis of one new share for every two held at $0.035 a share. Out of the 411,796,609 shares on offer, a total of 113,692,949 were taken up by shareholders. 

The offer was fully underwritten by Mr Lee Bug Huy and Mr Lee Bug Tong who currently have a relevant interest of 17.99 percent in Donaco. Following the offering, their stake will rise to 42.12 percent.

Donaco has been severely impacted by the COVID-19 pandemic and, in particular, the consequent closing of international borders which has significantly impacted the level of patronage at its casinos in Vietnam and Cambodia, it said in a statement.

It has been working with suppliers and banks to mitigate the effects, with Mega Bank agreeing to defer certain repayments under its debt facility until December.

We are pleased to advise that the funds raised through the offer will work to ensure that the business remains in a healthy position during the unprecedented COVID-19 pandemic,” Chairman Mel Ashton said.

“We look forward to using the funds to meet the upcoming repayment requirements on borrowings and stabilise the Company’s immediate financial needs.”