Zoo Digital to raise £2.58m to reduce debt, stregthen balance sheet

Subtitle provider Zoo Digital is planning to raise about £2.58m in order to reduce debt and to strengthen its balance sheet.

The London-listed company will issue of 28.61m new shares at 9p per each and will also issue 12.22m shares at 9p each by way of a three year extension, to the terms of its outstanding CLN1 and CLN2 loans, subject to shareholder approval at the next meeting on 4 May.

The funds raised are expected to strengthen the company's balance sheet, reduce its debt burden, and to provide growth capital in order for it to capitalise on its growing pipeline of opportunities.

Zoo is also planning on restructuring its share capital to allow it to issue shares at a price less than its current value of 15p each.

Earlier in April, the company said that it expects its full year results will be “significantly” ahead of the past two years and in line with expectations.

Revenues for the year ended 31 Match are forecast to be $16m and underlying earnings before interest, tax, depreciation and amortisation (EBITDA) will be $1.8m.

Shares in Zoo Digital were down 11.11% to 10p at 0811 BST.