Veritas to offer shares at $1.30 apiece in fund raising for Mad Butcher purchase

A prospectus will be registered later this week to raise up to $25 million.

Veritas Investments, the shell company that is acquiring the Mad Butcher franchisor business, will offer shares at $1.30 apiece, raising up to $25 million to help fund the purchase.

The price represents a premium to the volume weighted average price of the stock in the three months before the $40 million cash and scrip acquisition was announced on December 20, though it is 29 percent below the price Veritas stock last traded at, of $1.82.

Veritas expects to register a prospectus later this week. The capital raising will consist of a retail offer, including a priority pool of $3 million for existing Veritas shareholders and Mad Butcher franchisees, and an offer to select institutions.

Craigs Investment Partners is lead manager and is conducting a bookbuild. The proposal is subject to approval by Veritas shareholders at a meeting expected to be held in late April.

Craigs is underwriting $12.7 million of the share sale and has gained sub-underwriting agreements with Collins Asset Management, a company associated with director Tim Cook, for $2.5 million, and from RMI Holdings, associated with director Phil Newland, for $2 million.

The company has already received firm commitments for $10.2 million of shares, it said earlier this month.

Veritas was created from the shell left by the winding up of Salvus Strategic Investments, which sold assets and returned capital to shareholders.

(BusinessDesk)

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