{"id":39289,"date":"2013-09-13T08:55:16","date_gmt":"2013-09-13T12:55:16","guid":{"rendered":"http:\/\/www.bahamasb2b.com\/news\/?p=39289"},"modified":"2013-09-13T08:55:16","modified_gmt":"2013-09-13T12:55:16","slug":"brit-billionaire-increases-aaco-stake","status":"publish","type":"post","link":"https:\/\/www.bahamasb2b.com\/news\/2013\/09\/brit-billionaire-increases-aaco-stake","title":{"rendered":"Brit Billionaire Increases AACo Stake"},"content":{"rendered":"

\"\"<\/a>British billionaire Joe Lewis will increase his stake in Australian Agricultural Company to almost 20 per cent as the cattle company looks to raise $299 million to shore up its stretched balance sheet.<\/p>\n

The Bahamas-based Mr Lewis, who owns English Premier League club Tottenham Hotspur, has backed the board at a time when other major investors are selling down or not taking up entitlements.<\/p>\n

The raising, which will be used to pay down debt and fund construction of its $91 million Darwin abattoir, consists of a $219.2 million entitlement offer and $80 million in convertible notes.<\/p>\n

AACo chairman Donald McGauchie said the raising would strengthen the company’s balance sheet and accelerate its integration strategy.<\/p>\n

“While AACo’s fundamentals remain strong, a highly cyclical market and constrained capital structure has not allowed the company to capitalise on its asset base,” he said.<\/p>\n

AACo has a history of poor returns and weak cash production, and the stock has often traded below its asset value since it listed in 2001.<\/p>\n

There will be a 7-for-10 accelerated, non-renounceable entitlement offer issuing 219.2 million new AACo shares at $1 each, raising approximately $219.2 million.<\/p>\n

The issue price represents a 9.1 per cent discount to the theoretical ex-rights price and is fully underwritten.<\/p>\n

Joe Lewis, who already owned 13.5 per cent of AACo, will take up his $29.6 million entitlement in full and provide a sub-underwriting commitment of a further $34.6 million.<\/p>\n

Mr Lewis’s AA Trust will subsequently own 19.99 per cent of the company. However the AA Trust stake could rise to 29.2 per cent assuming the $80 million convertible note issued to the Trust is converted at its maturity in 2023.<\/p>\n

The almost $300 million in new capital will be used to fund the remaining $67 million cost of building the Darwin abattoir, with $20 million of further working capital requirements. Senior debt will be reduced by $205 million, taking the company’s gearing from 40.9 per cent to 23.5 per cent.<\/p>\n

Mr McGauchie said the company could not afford to be purely a primary producer and needs to focus on value adding.<\/p>\n

“It’s very important to improve returns on capital and we aim to have a company worth well in excess of its parts,” he said.<\/p>\n

The IFFCO-Felda joint venture has opted not to take up its entitlement for the second time, and its 16.9 per cent stake will be diluted.<\/p>\n

Source: Stock Journal<\/span><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

British billionaire Joe Lewis will increase his stake in Australian Agricultural Company to almost 20 per cent as the cattle company looks to raise $299 million to shore up its stretched balance sheet.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"facebook_10223285771444175_51037792744":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[3],"tags":[],"class_list":["post-39289","post","type-post","status-publish","format-standard","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/posts\/39289","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/comments?post=39289"}],"version-history":[{"count":0,"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/posts\/39289\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/media?parent=39289"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/categories?post=39289"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bahamasb2b.com\/news\/wp-json\/wp\/v2\/tags?post=39289"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}