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AJ Lucas announces equity offering
Posted on Friday, 19 May 2017 09:48
Australian gas drilling service company AJ Lucas Group has unveiled a rights issue valued at AUD 53.30 million (USD 39.54 million) in order to reduce its borrowings, support growth and fund further development.

The firm is placing 195.26 million stocks, representing a 32.3 per cent stake in the company’s enlarged capital, at AUD 0.28 apiece.

Petersons Securities has been appointed by the group as lead manager and underwriter to the offering, which is expected to close on 13th June 2017.

AJ Lucas is also conducting a share placing worth roughly AUD 5.00 million through the issue of 18.20 million scrips to institutional investors.

Earlier this year, it was reported that CIMIC Group may purchase AJ Lucas as part as its strategy to consolidate the industry.

A market capitalisation of AUD 95.68 million was estimated for the target, based on its close of AUD 0.25 on 10th March 2017, the last trading day prior to the statement.

North Sydney-headquartered AJ Lucas claims to be a frontrunning provider of specialist infrastructure, construction and drilling services to the energy, water and waste water sectors.

The firm’s portfolio is now centred on Europe and East Texas through its shareholding in Cuadrilla Resources and the Monument Prospect.

AJ Lucas had revenue of AUD 125.48 million in the full year ended 30th June 2016 (FY 2015: AUD 145.03 million) and underlying earnings before interest, tax, depreciation and amortisation of AUD 14.56 million (FY 2015: AUD 9.41 million).

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 24 deals targeting drilling oil and gas wells announced worldwide since the beginning of 2017.

The most valuable of these was Bermuda-based Borr Drilling’s USD 800.10 million capital increase with new and existing investors in March.

Other companies in the industry to be targeted in 2017 so far include Canyon Services Group, Patterson-UTI Energy and Atwood Oceanics.

© Zephus Ltd