Shares in Scout Gaming Group continued to fluctuate today after the business announced that its previously communicated SEK101m (€9.3m) share rights issue has been oversubscribed by investors.
The subscription period for the rights issue began in August and ended last week on 22 September.
As a result, underwriting undertakings entered into by a group of Scout’s largest shareholders will not be used.
The rights issue will raise approximately SEK101m for Scout before the deduction of issuing costs, while increasing the firm’s share capital by SEK10.7m.
Following the announcement of the news, Scout’s share price has wavered significantly today (27 September) as investors struggled to accurately value the business.
After closing at SEK0.94 yesterday, shares climbed as high as SEK1.17 in early trading before falling back to SEK0.95 at the time of writing.That figure continues to fall well short of its SEK6.95 52-week high, but still sees the firm secure a stronger position than at its 52-week low, when shares traded for as little as SEK0.22.
Following the original announcement of the rights issue in early August, Scout’s Q2 results some weeks later offered little in the way of reassurance for shareholders.
Shares continued to tumble after the firm’s latest financial report showed revenue had fallen 69.1% year-on-year to SEK4.3m, as performance weakened in both Scout’s B2B and B2C segments. The business declared a net loss for the quarter of SEK27.3m after expenses.
Capital raised by the rights issue will now be used to help fund a comprehensive restructuring programme and keep the business going by increasing its cash reserves.
The firm expects to realise the full benefits of its restructuring programme during Q4 of this year, according to acting CEO Niklas Jönsson.
