Netccentric (ASX:NCL) to raise fresh capital following share price spike

[ By The Market Herald ]

  • Marketing and advertising specialist Netccentric (NCL) has called a trading halt as it gets ready to tap investors for some extra cash
  • The company’s shares will remain in a halt until the full details of the fundraising are released or until Thursday, February 25
  • While NCL has not revealed the details of the raise, the company said last week it has been planning a $2 million placement
  • This came on the back of a 222-per-cent share price hike that prompted a speeding ticket and ASX query from the market operator
  • In its response to the ASX query, NCL said it did not know why shares have risen so much but it has been planning a potential $2 million placement
  • Whether the capital raise announced today is the same as this placement or if Netccentric will take advantage of the higher share price to plan a different type of raise is not yet known
  • NCL ended the 2020 financial year with SG$3 million (around A$2.87 million) worth of cash in the bank
  • Shares in the company last traded for 29 cents each on Monday, February 22

Marketing and advertising specialist Netccentric (NCL) has called a trading halt as it gets ready to tap investors for some extra cash.

The Singapore-based digital marketing company has not yet revealed exactly how much it plans to raise nor for what it will use the extra funding, but Netccentric hinted last week at plans to raise around $2 million. No plans have been confirmed so far.

As it stands, shares are slated to remain in a trading halt until Thursday, February 25, unless Netccentric announces the details of the capital raise before then.

NCL’s share spike

The company has seen some major share price growth over 2021 so far but particularly over the past few trading sessions.

NCL shares traded for between 6 cents and 7 cents throughout January before climbing to around 9 cents each over February.

Then between February 19 and February 22, Netccentric shares skyrocketed 222 per cent to an all-time high 29 cents per share.

When slapped with an ASX speeding ticket and asked to explain the sudden share price hike, Netccentric told the ASX it had no clue why shares suddenly soared.

The company said it was considering several small and non-material acquisitions but had only drawn up a non-binding material term sheet for the purchase of one Malaysian media business.

It was in this response to the ASX that Netccentric also highlighted the potential $2 million capital raise, though at the time the company said it had not determined any key terms of the placement or whether or not it would even go ahead.

As such, whether the upcoming capital raise announced today is the same as this planned $2 million placement or if Netccentric will take advantage of the high share price to launch a different capital raising plan is not yet certain.

Taking a look at Netccentric’s most recently-available financial figures, the company had SGD$3 million (around A$2.9 million) of cash in the bank at the end of June 2020 with no debt.

Netccentric offers influencer marketing, social media management, performance marketing, and more to customers across the Asia-Pacific region.

Shares in NCL last traded for 29 cents each on Monday, February 22. The company has a $76 million market cap.