03/05/2019 - 11:46

Keybridge bins $20m Yowie takeover

03/05/2019 - 11:46

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ASX listed investment firm Keybridge Capital has cancelled its proposed $20 million takeover of Yowie, citing the Perth-based confectionery company’s worsening financial results.

Keybridge bins $20m Yowie takeover
Yowie's losses have continuously increased over the past few years.

ASX listed investment firm Keybridge Capital has cancelled its proposed $20 million takeover of Yowie, citing the Perth-based confectionery company’s worsening financial results.

In a statement, Keybridge said Yowie “disappointingly” reported a significant operating loss, a nearly 50 per cent decline in operating revenue from the previous quarter, and a decline in the cash position of the company from the beginning of the quarter of US$18.751 million to US$16.982 million.

The company says that after considering Yowie's quarterly cashflow report, which Keybridge described as "disappointing", it will not pursue the takeover it announced on March 13.

Yowie reported a significant operating loss, a nearly 50 per cent decline in operating revenue from the previous quarter, and a decline in the cash position of the company from the beginning of the quarter of US$18.751 million to US$16.982 million.

It is expected to lose around US$4.02 million for the upcoming quarter ending June 30.

It lost $US5.2 million and $US6.6 million, respectively, in the past two full financial years.

When Keybridge made the takeover offer in March, it already held a 6 per cent stake in Yowie and said it wanted to get directors on the board to force a review of its operations, assets and liabilities.

"Keybridge notes that Yowie has consistently failed to structure or conduct its business operations in a profitable manner and that Yowie has incurred significant losses in the ordinary course of its business," it said at the time.

"Given those matters, Keybridge wishes to increase its stake in Yowie to a level where it is able to exert material influence."

Shares in Yowie were down 4.23 per cent to 6.8 cents each at 11.15am.

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