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Australian food and beverage manufacturer SPC Global Holdings (ASX: SPG) has launched a $100 million equity raising to dramatically reduce its debt load and "materially improve" its liquidity position to support its growth plans.
SPC Global is issuing one billion new shares at 10c each - a 71 per cent discount to its last traded price of 34.5c, which led to a sharp fall in the group's share price today.
Shares in SPC Global fell to a low of 13.5c but were trading at 15c, down 56.5 per cent, at 11.46am (AEST).
The fully underwritten capital raise comprises an institutional placement of $2.9 million and a renounceable entitlement offer of $97.1 million, with proceeds earmarked to cut pro forma net leverage from 3.9 times to 1.1 times based on 31 December 2025 figures.
The company, which owns the SPC, Original Beverage Co and Nature One brands, says the balance sheet reset will reduce its anticipated annual interest expense from $15 million in FY26 to an estimated $4.5 million to $5 million after the raise completes.
SPC Global reported net debt of $138.6 million at the half-year mark to 31 December 2025, alongside inventory of $108.9 million.
Net sales revenue for the period fell to $171.5 million from $197.9 million in the prior corresponding period, while normalised net loss after tax widened from $10.3 million to $11.2 million.
Managing director Robert Iervasi says the raise "marks an important step in strengthening SPC Global's balance sheet" and positions the business for its "next phase of execution".
"Having now completed over a full year as a combined group, we have moved decisively from transformation to execution," he says.
"Over the last 12 months, we have delivered to expectations and executed against our strategies - margins are improving, channel mix is favourable and our international expansion is tracking well.
"We are also seeing solid progress across our manufacturing and supply chain initiatives as a proud Australian manufacturer.
"Resetting the balance sheet at this point in time reduces leverage, strengthens liquidity and provides a clear focus for laser sharp execution in market."
The Shepparton-born SPC Global engineered a reverse takeover of listed drinks producer The Original Juice Company at the end of 2024 via a three-way merger worth $342 million that included Nature One Dairy in a bid to drive SPC’s global growth ambitions.
Iervasi says that without the capital raise, SPC Global "would not be in a position to appropriately fund its business strategy".
"This transaction positions us to continue investing in Australian manufacturing, our people and our brands, while maintaining disciplined capital management and a clear focus on long-term value creation,” he says.
The company has guided to a 25 per cent increase in normalised EBITDA over FY25's $30.3 million result, underpinned by more than $16 million in synergy benefits expected across FY26 and FY27.
SPC Global reported normalised EBITDA of $13 million for the first half of FY26.
A refined plan to close the company's Mill Park facility is projected to deliver more than $8 million in annualised savings on $3 million in capital expenditure, a significant reduction from an earlier estimate of $23.5 million flagged in February 2025.
Chairman Andrew Reitzer has committed to subscribe for $100,000 of new shares subject to annual general meeting approval, while Iervasi has indicated he intends to take up his full entitlement under the offer.
The entitlement offer is structured on a 5.27-for-1 basis, with the institutional component expected to settle on 21 May and the retail offer opening on 20 May and closing on 4 June.
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