Willdale rights issue 15 pct subscribed

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BRICK-MAKER Willdale on Monday said it has managed to raise $3,25 million through a rights issue, which will enable the company to restructure its debt and boost volumes after underwriter Old Mutual took up over 85 percent of shares on offer.
The company’s directors, two months ago proposed to raise fresh capital in the form of 10 percent semi-annual redeemable convertible cumulative preference shares through a rights issue in order to meet working capital and retooling requirements.
However, only 14.77 percent or 480,828 of the 3,255,000 preference shares offered were snapped at a subscription price of $1 each.
The balance of preference shares were taken up by the underwriter, Old Mutual Life Assurance Company.
In April, Willdale said low production volumes were pushing up the cost of production, leading to reduced viability of its brick-making operations.
Directors said the new capital injection would provide the company with an ability to “improve production volumes, restructure its balance sheet and enjoy economies of scale.”
The company’s debt was $6,65 million as of September 2013, with approximately 86,5 percent of that being short-term.Advertisement