Monday 7th February 2011 |
Text too small? |
The underwriters of Mercer Group's $9 million rights issue are having to pay for 59% of the shares to make up for shareholders who did not take up their rights to buy new shares.
Allan Hubbard and Jean Hubbard and their associated interests collectively hold 45.13% of Mercer but their assets are in statutory management. A spokesman for the statutory manager said that Hubbard Management Funds picked up a small percentage of their entitlement.
The rights issue was fully underwritten by Murray Capital's Rakaia Fund and by Christchurch financier Humphry Rolleston's Asset Management. Rolleston is chairman of Murray Capital, which is a private equity firm.
The stainless steel manufacturer has been experiencing difficult trading conditions and the money raised in the rights issue will be used to pay down a banking facility with Westpac, pay loans to Gresham Finance, pay debt to director Paul Hewitson and to fund working capital.
Westpac has extended the company's banking facility to December 31, 2011. The facility will be reduced by $1.5 million after the rights issue, by $1 million in July 2011 and by $3 million in November 2011. The company has been in breach of its banking covenants previously.
The company said today that shareholders had taken up rights to by 74 million shares, or 41% of the rights issue. Notice was given today requiring the underwriters to make payment for the 105.9 million shares, which was the shortfall on the rights issue.
The shares were sold in the rights issue at five cents each.
NZPA
No comments yet
PaySauce Quarterly Market Update - September 2024
October 2nd Morning Report
Rua Releases Annual Report for Year Ended 30 June 2024
SCL - Settlement of orchard sales
The Warehouse Group 2024 ASM and Director Nominations
AIR - Update on Chief Operational Integrity and Safety Officer
Comvita Limited - Annual Report 2024
September 27th Morning Report
Spark announces departure of Finance Director
FBU - Retail Entitlement Offer Opens