Pioneering boiler company raising £29m in share placing

Tony Stiff

Listed Chester company Flowgroup – the pioneer of environmentally friendly microCHP boilers for domestic use – is set to raise £29m in a share placing.

This follows the termination of discussions over the sale of its energy business as a result of access to capital via the fundraising which will able it to be retained an grow.

The company has issued a placing of new ordinary shares of about £9.5m, an open offer and primary bid offer, in aggregate, of about £4m as well as a loan note subscription comprising the issues of £15.5m in convertible unsecured loan notes.

Flowgroup has also announced that it has reached an agreement with Jabil that will terminate its contract with its production partner Jabil – which has a manufacturing site in Livingstone, Scotland – on mutually acceptable terms and at a significantly reduced cost for the group.

Flowgroup chief executive Tony Stiff said: “We believe that this transaction, led by Palm Ventures, is in the best interests of all of the company’s stakeholders as it will recapitalise our balance sheet and position our Flow Energy business for growth.

“We appreciate the enthusiasm and support that our shareholders have shown as we embark on the next phase of our enterprise, unhampered by the capital constraints we have historically faced.”

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