Synlait completes institutional component of rights offer, raising $59 million

Wednesday 21st September 2016

Synlait Milk, the NZX-listed dairy company, has completed the institutional component of its rights offer, raising about $59 million.

As part of its earnings announcement on Monday, the company said it planned to raise a $98 million in a rights offer to expand its infant formula manufacturing, consumer packaging, infrastructure requirements and value-added cream manufacturing.

“Synlait is a growth company. Our FY16 performance highlights the progress we’ve made since our IPO in 2013 towards our aspiration of making more from milk,” said chairman Graeme Milne. “We are looking at investing approximately $300 million in capital growth projects over the next three years to solidify this position and continue pursuing profitable opportunities to make more from milk.”

Under the rights offer, eligible shareholders can buy two new shares at $3 apiece for every nine existing shares held on the Sept. 21 record date. Excluding entitlements to pre-committed shareholders, China's Bright Dairy and Munchkin, the offer for up to 32.5 million new shares is underwritten by First NZ Capital Securities.

The institutional entitlement offer closed yesterday, raising 60 percent of the total capital Synlait plans to raise. The company's largest shareholder, Bright Dairy, participated in the offer to maintain its 39 percent holding.

Synlait said 4.7 million new shares were available for the institutional bookbuild component of the offer, to be conducted today, while the retail component of the offer will open on Thursday morning and close on Oct. 11.

The shares last traded at $3.507, and have gained 15 percent this year.

BusinessDesk.co.nz

Comments from our readers

No comments yet