Bubs Australia secures investment to extend production capability

Infant formula maker Bubs Australia has raised A$28.3m ($20.6m) through a share placement to enhance its production capacity and work on new product innovations.

The company will use the proceeds to launch Vita Bubs into the vitamin and mineral supplements category.

The company noted that the placement was supported by its existing stakeholders, as well as by the new institutional investors from domestic and international markets.

With 80 cents per share, the new shares under the placement are expected to be issued on 10 September 2020 and will be equally ranked with the existing shares in the company.

Bubs Australia executive chairman Dennis Lin said: “We are very pleased with the successful outcome of the placement. This shows institutional and sophisticated investors continue to strongly support our vision. It is a terrific vote of confidence in Bubs and we thank all who have made it such a success.”

In addition, the Australian firm has announced that it will be undertaking a share purchase plan (SPP) to raise nearly A$10m ($7.2m), with the potential to raise a maximum capital of A$11.7m ($8.5m).

The company noted all the eligible shareholders can subscribe for up to A$30,000 ($21,852) worth of new fully paid ordinary shares without any brokerage or transaction charges.

Bubs founder and CEO Kristy Carr said: “Our first priority will be to progress our announced strategy to accelerate SAMR (State Administration for Market Registration) for China manufacture of Bubs Goat Infant Formula made from 100% Australian goat milk.

“We are now well-positioned to maintain the operational momentum, strength and agility established during the year, to execute on strategy, and capture new opportunities while ensuring we continue to implement key marketing strategies.”

Last November, Bubs Australia signed a master distribution agreement with Alibaba Centralised Import Procurement (CIP) for importing adult goat dairy products for mainland China.