Hellaby halts shares for $50m capital raising at 10% discount
Hellaby Holdings had its shares halted for a $50 million equity capital raising as the diversified investment company hunts for acquisitions to revive earnings growth.
The capital raising will be by way of a $40 million placement to institutions at $3 a share, with entitlement to the company's 5 cent interim dividend payable on April 19. It also plans to raise $10 million in a share purchase plan at $2.95, less the dividend.
The shares last traded at $3.29 and have gained 15 percent in the past 12 months.
Castle Investments, which owns 30.5 percent of Hellaby, will participate in the capital raising.
"The capital raising is part of Hellaby Holdings' strategy to position the company for future growth and broaden the shareholder register," the company says. "Hellaby continues to develop a pipeline of value accretive acquisitions."
The company last month said profit in the year ending June 30 will be about $18.5 million, down from $19.3 million a year earlier.
The latest results will include a net negative impact in the fourth quarter of $800,000 from the contribution of a share of earnings from recently acquired Contract Resources and one-time transaction and funding costs.
Market conditions have remained soft in 2013, it says.
Contract, a specialised engineering maintenance and industrial cleaning company, is expected to generate earnings before interest, tax, depreciation and amortisation of more than $20 million in 2014, Hellaby says.