Shares in leading civil and mining contractor NRW Holdings (ASX: NWH) have soared after returning to sharemarket trading following the completion of a strongly supported $120 million equity raising. The raising, to fund NRW’s acquisition of BGC Contracting, was priced at $2.85 following an institutional bookbuild run by UBS and Euroz. The support from investors was emphasised by the fact the placement price was above NRW’s $2.83 close on Wednesday prior to going into the trading halt yesterday to carry out the equity raising. NRW shares were up more than 6% to $3.01 in trade today. NRW is following up with a share purchase plan to raise up to $10 million.
NRW Holdings Limited (ASX:NWH) (NRW or the Company) is pleased to announce that it has received commitments to place 42.1M million new fully paid ordinary shares in NRW (Placement Shares) at an issue price of $2.85 per Placement Share, to raise $120M before costs (Placement).
The net proceeds from the Placement are intended to be put towards the acquisition of BGC Contracting Pty Ltd (Acquisition).
The issue price represents a:
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1.4% premium to NRW’s adjusted closing price of $2.81 on 27 November 2019[1], being the last trading day prior to NRW entering a trading halt in connection with the Placement; and
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5.2% premium to NRW’s adjusted 10-day volume weighted average price of $2.71, up to and including the last trading day prior to the trading halt[2] .
Jules Pemberton, NRW’s CEO & Managing Director, said:
“I am extremely delighted with the success of the Placement which was very strongly supported by investors who clearly share our enthusiasm for the acquisition of BGC Contracting, which represents a value accretive step change in scale and diversity for NRW’s business across Australia at an attractive value.
We are particularly grateful for the support of our existing shareholders and pleased to welcome a number of new, high quality institutions onto the NRW register.
NRW’s eligible shareholders will have an opportunity to participate through the share purchase plan with details to be sent to shareholders in the coming weeks.”
The Placement Shares will be issued to certain professional and sophisticated investors in Australia and eligible investors in certain overseas jurisdictions. The Placement Shares will rank equally with existing NRW shares, except that they will not be entitled to the FY19 final dividend. The Placement was made using NRW’s existing placement capacity under ASX Listing Rule 7.1 and shareholder approval is not required in connection with the Placement.
Additional information regarding the Placement and Acquisition can be found in the announcement and investor presentation released to the ASX on 28 November 2019.
Settlement of the Placement is scheduled for Tuesday, 3 December 2019, with the Placement Shares expected to be issued on Wednesday, 4 December 2019 and trading to commence on the ASX the same day.
UBS AG, Australia Branch acted as sole underwriter and lead manager and Euroz Securities Limited served as co-manager to the Placement. Longreach Capital acted as financial advisor to NRW.
[1] NRW closing share price of $2.83 on 27 November 2019 adjusted to take into account that the Placement Shares will not receive the FY19 final dividend of
[2] cents per share. 2 NRW 10-day VWAP of shares of $2.73 adjusted to take into account that the Placement Shares will not receive the FY19 final dividend of 2 cents per share.
