Abalone exporter to raise $2.9m

Ocean Grown Abalone is seeking to raise $2.9 million through a one-for-eight rights issue to progress the feasibility and development of its Esperance hatchery and grow-out project in Western Australia.

The company will issue approximately 22.3 million shares at an issue price of 13 cents per share, with the offer fully underwritten by Morgans Financial.

The offer comes two weeks after Ocean Grown announced the completion of a design study for developing the Esperance hatchery.

The project site is approximately 34 hectares in size and is located about 10 kilometres from Esperance.

Ocean Grown has a lease of the land until July next year, with an option to extend the lease a further 12 months for $10,000, during which the company has the right to develop an abalone hatchery for $500,000.

The company anticipates the feasibility study will be completed around April 2020.

Shares in Ocean Grown Abalone are trading at 14.5 cents per share, as at 11:45am AEDT.