Kier’s £250m rights issue receives 38% take-up
Kier Group’s £250m rights issue has received just 38% take-up from shareholders.
Kier announced 64.5m new shares at 409p on 30 November, with 24.3m shares accepted by 19 December.
Numis Securities, Peel Hunt, Citi, HSBC and Santander had agreed to underwrite the rights issue, offering investors shares at a discounted price.
Kier Group’s £250m rights issue has received just 38% take-up from shareholders.
Kier announced 64.5m new shares at 409p on 30 November, with 24.3m shares accepted by 19 December.
Numis Securities, Peel Hunt, Citi, HSBC and Santander had agreed to underwrite the rights issue, offering investors shares at a discounted price.
But more than half of investors opted against the emergency fundraising.
It means the five lenders will need to offload more than 40m shares above their current value.
Kier will receive the £250m net cash by 28 December. It will use the finance to pay down debt, strengthen its balance sheet and win new contracts.
In its rights issue announcement, the outsourcer recognised “tighter credit markets and more stringent tender pre-qualification requirements”.
Kier said potential clients and customers were “increasingly focused” on service providers’ balance sheets, with “increasingly rigorous and automated” procurement processes.
Haydn Mursell, chief executive of Kier Group, said: “Following the completion of the £250m rights issue, Kier enters 2019 with a strong balance sheet which puts us in an excellent competitive position.”
Rothschild advised Kier.
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