GALLIFORD Try has announced a rights issue to raise £157.6 million to cover over-run costs on the Aberdeen Western Peripheral Route/Balmedie to Tipperty (AWPR) project.
The construction group stated that over-run costs in relation to the AWPR contract were compounded by the compulsory liquidation of Carillion, which together have increased the group’s total cash commitments to the project by in excess of £150 million. The rights issue intends to cover these costs and strengthen the group’s balance sheet.
The one-for-three fully underwritten rights issue of 27,741,204 new ordinary shares of 50 pence aims to raise the proceeds required. The issue price of 568 pence per rights issue share represents a 32.8% discount on the daily list price of 937.5 pence on March 26. The rights issue is fully underwritten by HSBC Bank, Peel Hunt and Barclays Bank.
A prospectus fully detailing the rights issue is to be made available on the Galliford Try website.
Peter Truscott, chief executive officer commented, “Following the group’s strong financial and operational performance in the first half, with revenue growth across all three of our businesses and excellent progress against our 2021 strategy, we are pleased today to announce the terms of the group’s fully underwritten rights issue.
“We see excellent opportunities and demand for both our private and affordable homes businesses and our construction business continues to benefit from the current planned investment in the nation’s infrastructure.
“The rights issue proceeds will strengthen the group’s balance sheet and ensure that the group’s businesses are in a position, with the appropriate capital, to deliver on their respective growth opportunities in line with the group’s stated 2021 strategy.”