Atlantic to recapitalise with $2.75m capital raising

Offers for the recapitalisation of Perth-based pearl producer Atlantic Ltd will open today, with the company aiming to raise $2.7 million for debt repayment, working capital and new opportunities.

The company will issue 220 million shares at one cent each to raise $2.2 million in a public offer. Atlantic will also raise $200,000 through the issue of 20 million shares at one cent to former chair and creditor Giuseppe Rotondella, and $350,000 through the issue of 70 million shares at 0.5 cents each to clients of Ventnor Capital.

Ventor clients will also receive 70 million options with an exercise price of one cent each.

The company went into administration in February, after incurring its third successive annual loss.

Under its recapitalisation plan, the company will consolidate its existing issued capital on a 1 for 2 basis, and sell its Myanmar pearl farm to Mr Rotondella's Golden Pearl Pty Ltd for $300,000.

The farm generated sales of $1.05 million in the year to June 2006.

Companies controlled by Mr Rotondella will also be paid $1.3 million once the offer closes, with deed administrators paying $50,000 into the trust found extablished for the benefit of admitted creditors.

Atlantic will enter into exclusive sales and marketing agreements with subsidiary Barracuda Fisheries Pty Ltd and Myanmar Atlantic Company Ltd, giving it the right to promote all pearl products from their operations, and being entitled to a commission of over 5 per cent from all product sales.

Brian McMaster and Jack James of insolvency firm KordaMentha were appointed joint and several administrators of the company, with the previous directors resigning from the board.

Taking their place earlier this month were chartered accountant John Hannaford, Anthony Veitch and Latin Gold Ltd managing director Jim Malone.

Morgan Barron will serve as company secretary.

Ventor Capital will serve as corporate advisor, with RSM Bird Cameron Partners acting as auditor and Price Sierakowski Lawyers as solicitors to the firm.

The closing date for offers is July 27.