Invigor to call new shareholders meeting for recapitalization – CEO

09 September 2020 - 09:38 am UTC

by Adam Orlando in Perth

Invigor Group, the Australian data and analytics solutions company, will call a new shareholders meeting in the next two to three months to seek approval for modified recapitalization measures, including a capital raise, CEO Gary Cohen said.

 

The New South Wales-based company, which has had its shares suspended from trade on the ASX since October 2019, will seek to retain financial advisors for the potential capital raise and is likely to raise at least AUD 5m (USD 3.6m), the CEO said. It welcomes approaches from advisory firms, he noted.

 

The meeting was previously due in May but had to be postponed due to the novel coronavirus pandemic, Cohen said. It is now proposed for 4Q20 before Christmas, he added.

 

The upcoming meeting will seek shareholders’ approval for renewed recapitalization options, including converting a large amount of its debt to equity and approve the new capital raise, as a follow-up to a November 2019 shareholder meeting called following its ASX suspension, he said.

 

Invigor’s shares were suspended “due to balance sheet issues” and are yet to be released from a trading halt. The company last traded at AUD 0.025. It traded as high as AUD 0.12 on 29 May 2019 and had a market cap of about AUD 4m when its shares were suspended.

 

On 31 August the company announced it found a buyer for its 100%-owned German subsidiary TillerStack, confirming a 12 February report by Mergermarket that the field service management firm was up for sale. Some proceeds from the sale, which is expected to be finalized in the coming months, will also be used to pay down debt, shore up its balance sheet, and assist Invigor in growing its core business, Cohen said.

 

In February this year, the company restructured some of its financing facilities when it extended the term and amount of its Marcel Equity loan facility to 31 December 2021 and AUD 7.5m with a 15% per annum interest rate, according to a company document. The company intends to have a significant amount of that debt converted to equity by the end of 2020, Cohen said.

 

According to the CEO, an independent expert report has said that converting the Marcel Equity debt to equity was feasible.

 

Looking ahead

Meanwhile, provided that Invigor gets approval to recapitalize and can resume trading on the ASX, it will look to grow, firstly domestically and then later possibly abroad, and will consider potential strategic partnerships, the CEO said.

 

The company is currently at the early stage of looking at several opportunities as to how such partnerships may evolve and what equity structure they could form, but it is “hoping that one or more of these entities could be a key investor in the company”, Cohen said.

 

Invigor has some targets in mind that offer synergies and access to new verticals, however how any such deals will be funded is yet to be determined. It is interested in targets that could help the company “attract capital more quickly”, and is in talks with international groups, particularly out of Israel, the CEO said.

 

When looking at growth options it will prefer targets in which both parties can combine complementary data sets, where Invigor gains access to new verticals. For example, new data sets could be information and market intelligence within the fintech sector, he added.