Gage Roads to raise up to $8m

Contract brewer Gage Roads says it is on track to bump its production capacity up to 3 million cartons per year by 2015, after securing $7.4 million through a share placement to supermarket giant Woolworths and institutional investors.

Gage Roads said the shares would be offered at 15 cents each in the placement, which is being managed by CCZ Statton Equities.

Woolworths will tip in just over $1.8 million, while the remainder will be taken up by institutional investors.

The brewer said it would use the funds to partially repay its debts with ANZ and to bolster working capital.

Meanwhile, Gage Roads said it would seek to raise a further $500,000 from existing shareholders, though a purchase plan also priced at 15 cents per share.

The company recently increased its production capacity to 2.5 million cartons per year, after completing its capital expansion at the end of March.

As well as its own branded beers and ciders, Gage Roads produces Woolworths’ Sail & Anchor beers, contract brews for Matso’s Broome Brewery, San Miguel Yamamura, and the Swan Valley’s Duckstein Brewery, among others.

At close of trade today, Gage Roads shares were steady at 17 cents.