Sky City lifts ceiling on share purchase plan

Friday 22nd May 2009

Sky City Entertainment Group, whose shares have an average rating of ‘outperform’, amended the terms of its top-up offer of its share purchase plan, bringing the total that can be raised to $43 million from $35 million.

The change removes the condition that the top-up portion of the sale depended on applications under the share purchase plan not exceeding the $35 million limit. The change will “provide a greater level of certainty to eligible investors,” Sky said in a statement today.

The maximum level of the top-up remains unchanged at $15 million.The share purchase plans and the top-up close on May 25 and have weakened 4.7% this year. Sky isn’t in dire need of more capital and the capital raising – about $230 million including last month’s placement to institutions – was a “prudent” step to “proactively strengthen the company's capital structure and enhance its financial flexibility,” chief executive Nigel Morrison said last month.

Institutions queued for stock in initial the placement, which was done at $2.62, the top end of the bookbuild range. The shares slipped 1.1% to $2.82 today and are down 2.7% this year.

The company is forecasting forecast profit this year will be between $99 million and $106 million. Profit last year of $49.9 million included a $60 million writedown of its cinema unit.

Businesswire.co.nz

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