Centrepoint Alliance will raise $11.4 million through an entitlement issue, to fund expansion and strengthen its balance sheet.

Last week it raised $2.6 million through a placement to institutional and sophisticated investors.

Centrepoint says $5 million of the $14 million to be raised will go towards growing its premium funding business.

Premiums funded grew 23% to $254 million in the six months to December 31, while profit before tax from the division increased 32% to $2.5 million, according to the offer document.

Profitability is increasing with scale, and Centrepoint may acquire small and mid-sized funders.

“The premium funding business is expected to continue to grow, requiring capital,” it says. “Additional equity investment will give the ability to raise further debt.”

The offer is fully underwritten and shareholders will be offered a one-for-three, non-renounceable entitlement at 32 cents a share.