National Australia Bank (NAB) is set to forgive the debts of Victorian-based toy company, Funtastic in a debt forgiveness and capital raising deal.
NAB will forgive the debts of Funtastic upon receipt of a debt reduction payment of $5 million.
To fund the payment, Funtastic has proposed an institutional payment and entitlement offer (capital raising) to raise approximately $8.2 million.
On Friday last week, Funtastic asked the ASX to put its securities into a trading halt and this was granted on Monday.
Funtastic's stocks are expected to resume trading on 12 September.
Funtastic said that once the payment is made to NAB, this will free up the company to pursue new opportunities.
“On completion of the capital raising (and after making the debt reduction payment), Funtastic's balance sheet will be transformed giving it the financial flexibility to pursue a number of exciting commercial opportunities.”
To read Funtastic's statement, click here.