HEALTH tracker Fitbug raised £1.67m from a share placing and fresh loan agreement yesterday.
The penny stock, which fell 25 per cent in trading after the fundraise, generated £665,000 by placing 26.6m new shares at 2.5p.
A further £350,000 worth of shares were sold to investor NW1 Investments. Fitbug also agreed an additional £650,000 convertible loan from NW1 as part of the deal.
The new loan restructures existing obligations and will save the group about £300,000 a year on interest savings, the business said.
“These new funds and attractive loan restructure terms significantly strengthen the company’s financial position and prospects,” Fitbug chairman Fergus Kee added.
The company said it will use the fresh funds to market and develop new and existing products, which include its Kiqplan fitness app.
Fitbug hit the headlines earlier this year after it won a lucrative contract with Sainsbury’s and US store Target to stock its fitness tracker, sending shares soaring.
It has since struck deals with employee benefit firms Towers Watson and Punter Southall.