|
A slew of well-known investors will take stakes, or up their existing stakes, in AusGroup, injecting about S$37 million into the business in exchange for 1.05 billion new shares at 3.5 cents per share. |
|
Investors |
No. of subscription shares |
Value |
|
AOC Acquisitions |
750 m |
S$26.25 m |
|
Bernard Toh |
200 m |
S$7 m |
|
Melvin Poh |
100 m |
S$3.5 m |
The funds will support continued business growth -- AusGroup has reported five consecutive quarters of profit -- and reduce gearing levels.
Since 2016, AusGroup has undertaken steps to significantly reduce its debt, enabling it to define and execute a plan for the future.
The share placement agreements position the AusGroup to commence discussions with its noteholders to extend the notes’ maturity date beyond October 2018. The Company is confident it will gain all stakeholders’ support in this endeavour.
The Company expects to receive gross proceeds of at least S$37 million.
Up to 30% of the funds raised will be used for partial cash redemption of the outstanding notes and the remainder for supplementing the Company’s growing general working capital requirements as it continues to expand.
In addition to the share placement, AusGroup plans to launch a rights issue on the basis of 1 rights share for every 2 existing shares with an issue price of 3.5 cents per share, which is a discount of 25.37% to the last trading day’s VWAP of 4.7 cents on 28 March 2018.
CEO and Executive Director Shane Kimpton said: “As we continue to work towards reducing debt, we are now in a solid position to focus on the strategic growth of our business across Australia and South East Asia.
"The injection of capital will allow us to support this growth and continue to deliver for our clients and enter into new contracts. Additionally, it will support our Port Melville facility which is now operational, offering a fuel supply service for customers in the Northern Territory of Australia.”