Insurance claims services provider Resources In Insurance Group is raising £300,000 from a convertible loan note issue.
The conversion price is 0.55p and RIIG’s nominal value will be reduced from 1.5p a share to 0.1p a share in order to enable this to happen. The loan notes are due to be repaid in 2015 and have an annual interest rate of 12%.
Bluehone AIM VCT2 is investing £100,000 in the convertible.
The cash will be used to finance organic growth.
At 0.42p a share –up 80% over the past year – RIIG is valued at £580,000, so the cash raised is a significant amount and conversion of the loan notes would be highly dilutive.
Daniel Stewart is being replaced as nominated adviser and broker by Allenby Capital and Rivington Street respectively.
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