SILVER CHEF COMPLETES $21M CAPITAL RAISE
Written on the 19 April 2017 by Paris Faint
HOSPITALITY equipment provider Silver Chef Limited (ASX: SIV) has announced that it has successfully raised a significant amount of capital following the completion of its latest entitlement offer.
The entitlement offer, which began on 21 March, was divided through an institutional component and a retail component to boost total capital by an estimated $21 million.
Fully underwritten by Morgans and Wilsons Corporate Finance, the offer involved an accelerated one for 12 pro rata non-renounceable entitlement of fully paid ordinary shares in the company.
Silver Chef says the $21 million will go partly towards asset growth, which includes the development of its cars and equipment hire business GoGetta.
According to the company's ASX announcement, "the funds raised from this entitlement offer will be used to support the Company's ongoing growth in its asset base and maintain an appropriate mix of funding sources."
"Executing management's strategy for improving the return on assets across GoGetta channels remains a key focus.
Silver Chef says the money will also go toward rejigging the company's overall capital management structure.
"The company is transitioning to an environment of lower future equity requirements as it intends to increase the wholesale debt funding capital in early financial year 2018," it says.
"This entitlement offer will ensure the company retains its traditional gearing discipline and maintains current growth targets as it transitions into a securitisation-based capital structure."
Silver Chef profit guidance for FY17 remains in the range of $21 million to $23 million, which is around $2 million less than its projected underlying result due to damage suffered from the fraudulent cyber-attack which hit the company in November.
Silver Chef shares are trading up just over 1 per cent at $7.59 at the time of writing.
Business News Australia
Author: Paris Faint