Apiam CEO Dr Chris Richards said the company now has a chance to capitalise on an “exciting market opportunity”.

Animal health company Apiam (ASX:AHX) is executing on a major regional expansion strategy, and the company’s institutional shareholders are on board.

With its market-leading network of vet clinics and animal health practices serving Australia’s regional growth corridors, the company has been busy building the infrastructure and workforce to meet increased demand.

And those plans got a further boost this morning, as AHX announced the successful completion of a $6m institutional share placement at 80c per share.

The deal is evidence that investors are backing the company for further growth, given that the 80c placement price is a material premium to where AHX shares started the year at around 60c.

Apiam said it will use the funds to accelerate its “regional expansion plans, through investment in opening new greenfield clinics as well as strategic acquisitions”, in accordance with its ongoing acquisition program.

Market conditions

Commenting on the raise, Apiam said it now has an opportunity to capitalise on a number of sector tailwinds that have formed behind regional animal health services.

“There has been a rapid acceleration in pet and animal ownership in regional areas, as well as changing population dynamics, which have combined to create highly favourable veterinary market conditions,” the company said.

Already, Apiam has opened new greenfields clinics in Torquay North and Shepparton – two rapidly expanding growth corridors in regional Victoria.

Armed with an additional $6m in extra capital, Apiam CEO Dr Chris Richards said the company will remain pro-active as it assesses a number of opportunities to make further value-accretive acquisitions.

Along with increased rates of pet ownership, Richards said changing population demographics and strong seasonal conditions for farming clients have presented Apiam with an “exciting market opportunity”.

“This placement will support us in accelerating our regional expansion plans and capturing the significant growth we are seeing in many veterinary areas,” Richards said.

“As an established regional player, Apiam is well placed to scale-up and leverage these opportunities as they emerge.”

This article was developed in collaboration with Apiam, a Stockhead advertiser at the time of publishing.

 This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.