ASOS raises £247m in share placing
ASOS has raised £247m from a share placing announced yesterday with the shares mostly snapped up by existing investors.
Shares were placed at 1,560p each, which was a slight premium on yesterday's closing price of 1559.5p, and represented around 19% of its issued share capital. Many of the etailer's board increased their holdings along with investors such as Danish fashion group Bestseller.
ASOS said the fund raise was a precaution in light of the COVID-19 crisis, which had knocked around 20-25% of sales in the past three weeks.
Despite this the company said it had been confident that it already had significant liquidity to see out the crisis and had achieved a 21% increase in group sales to the end of February to just under £1.6bn.
As well as raising the cash through the placing, it also extended its existing £350m revolving credit facility by £60m-£80m over 12 months.
In a statement accompanying the company's interim results revealed last night, CEO Nick Beighton said: “The COVID crisis is clearly going to continue to be tough for everyone and the short-term outlook remains highly uncertain, but the measures we have taken ensure we are able to be clearly focussed on making sure that ASOS emerges as a stronger and better business.”
The company said that the drop in demand was seen across all markets but after an initial shock when the virus hit each market, demand had stabilised. Analysts believe that demand for fashion in the UK has dropped 40% in the past few weeks, which should suggest that ASOS is outperforming the market as a whole.