Moa secures mystery investor in $5.5m capital raising

Moa Group wants to shore up its balance sheet for the next financial year. Photo / File

Moa Group wants to raise up to $5.5 million to shore up its balance sheet for the next financial year amid ongoing uncertainty for its hospitality business due to Covid-19.

The beer maker turned restaurateur said it wants to raise $5.5m at 14 cents per share, made up of $2.5m for 17,857,143 new shares to a new cornerstone investor. It also plans a one-for-five rights issue to raise another $3m.

Under the deal, the anonymous investor will take up its full entitlements under the rights issue for another $480,00 worth of shares, and if existing shareholders don't take up all the shares available, the investor can buy more to increase their total investment to $4m

Shares in the company rose 17 per cent following the announcement to 16.5 cents. The share price has fallen 60 per cent during the past 12 months.

While its brewery remains operational, Moa's hospitality businesses - which make up two-thirds of its revenue - are closed under the current lockdown.

Today, Moa said it reached an agreement with the vendors of Savor Group to defer an additional $3.2m cash payment for the host of restaurants it purchased in early 2019. Moa will also issue $2.2m of shares to the Savor Group vendors at the issue price of 14 cents.

Moa gave more clarity around its banking support from Bank of New Zealand, which it said has given it a principal holiday and $2m in additional funds.

Executive chair Geoff Ross would not be drawn on the identity of the "prominent New Zealand businessperson" who is investing, but said he had a business which already supplied restaurants and grocery stores with meat, pasta and produce. He was not an existing supplier of the company.

The new investor's complementary business will "add significant opportunities to the group, sharing our combined vision of an integrated 'gate to plate' hospitality and beverages group," Ross said.

"The cliche term is 'gate to plate' but the benefit is not just controlling the margins, but also consumers demand more and want to know where the product is coming from and that needs that to be genuine," Ross said.

While Moa's hospitality businesses are not open, Ross said no staff had yet been made redundant. The company was considering but had not yet applied for the wage subsidy provided by the government.