Finsbury Food Group has placed and subscribed more than 10 million new ordinary shares, raising approximately £3.9m before expenses.

The Cardiff-based bakery manufacturer announced the move this morning, with 10,364,277 shares in total at a price of 38 pence per share.

The placing price represents a 5% discount to the closing middle market price of 40p per share on 13 November. Cenkos Securities is acting as a broker to the placing.

John Duffy, chief executive of Finsbury Food Group, said: “We are really pleased with the support we have seen for the placing from both new and existing shareholders. We are committed to investing in the company to build upon the foundations that are already in place and look forward to growing the business further over the coming years, in turn driving shareholder value.”

Duffy now owns 2.16% of shares in total, post placing,, – more than 1.38 million – while Stephen Boyd and Paul Monk, group finance director and non-executive deputy chairman, have 0.87% and 0.69% of the shares respectively.

The company said the money raised from the placing will be invested in new additional capital investment projects within its cake business, including the further development of “product portfolio capability utilising proven technologies and automation”.

In addition, Finsbury’s directors believe the planned investment will deliver a final annualised benefit of £2m.

Finsbury published an update of its financial performance for the first three months of the year, revealing “continued strong sales growth” in its bread and free-from division, offset by a small decline in its cake business.