Mobile gaming company iCandy Interactive (ASX: ICI) has banked an early Christmas present in the form of a heavily oversubscribed $10.5 million share placement before costs.
The company has confirmed it will issue approximately 71 million new shares at a blended issue price of $0.14 each to fund production capabilities and enhance product quality at its game development studios across south-east Asia.
Part of the funds will also be used for marketing and general working capital.
The placement was supported by sophisticated investors including existing shareholder Fatfish Group (ASX: FFG), which committed $500,000, and iCandy chairman Kin Wai Lau with a $50,000 investment for the total purchase of 3.9 million new shares and 1.9 million options with a strike price of $0.22 and December 2022 expiry.
Growing the business
Mr Lau said the placement will help grow the business and its products for an addressable market of more than 350 million mobile users worldwide.
“[We have] a track record in building award-winning studios and we are now very well positioned to aggressively expand our business that has a well proven business model and [strong] track records,” he said.
“We would be looking into expanding further in our key market of North America, and would also aim to do more in the Chinese gaming market,” Mr Lau added.
The placement was led by Sydney-based Evolution Capital Advisors.
Mr Lau’s investment and the Fatfish portion of the placement will be subject to iCandy shareholder approval at an extraordinary general meeting.
Share price growth
iCandy’s year-to-date performance has reversed the company’s share price, which had dropped 60% in the three years prior.
An oversubscribed September placement of $1.25 million followed by another $1.25 million commitment by Acorn Managed Investments was spent on accelerating the roll-out of the company’s new gaming products and on increasing its overall market exposure.
In the same month, iCandy received 1.06 million pre-orders of the highly-anticipated Masketeers: Idle Has Fallen game, which went on to record revenue growth of $265,000 in its first 10 days and was “well above management expectations”.
On the back of the strong demand, the company invested considerable resources in further developing and enhancing the game for key markets.
“We are of the opinion that the strong revenue growth trend of Masketeers will contribute significantly to [our] overall revenue in the current financial year,” Mr Lau said.