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SeaLink to raise cash, partly fund Transit Systems deal
Posted on Tuesday, 08 October 2019 10:20
SeaLink Travel is raising a total AUD 154.00 million (USD 103.83 million) in two different capital increases to partly finance the group’s largest-ever acquisition that will provide a springboard for growth at home and abroad. The value of AUD 3.50 apiece for the issue of 44.00 million new shares in aggregate represents a discount of 7.7 per cent to the theoretical ex-rights price and of 10.5 per cent to the last unaffected close of AUD 3.91. SeaLink is holding a fully underwritten AUD 65.00 million placement to new and existing institutional shareholders. In conjunction, the listed cruises and ferries operator intends to raise AUD 89.00 million through a pro-rata, accelerated, non-renounceable entitlement offer. Ultimately, proceeds will be used to finance the cash portion of the acquisition of Transit Systems, Australia’s largest private operator of metropolitan public bus services, and an established international player in London and Singapore, for AUD 698.00 million. When also taking into account the AUD 269.00 million-worth of new shares issued as part consideration for the acquisition, certain vendors of Transit Systems will become substantial holders of SeaLink, with 33.4 per cent of the enlarged company. The group will fund the balance through AUD 410.00 million of new multi-tranche debt and revolving credit facilities and a rollover of the target’s current financing arrangements. SeaLink expects to have 2.5x pro forma net debt to anticipated earnings before interest, tax, depreciation and amortisation for the 12 months ended 30th June 2019. The group’s AUD 154.00 million fundraiser will be the 9th largest capital increase by an Australian travel or air, rail, water, truck, transit or passenger transportation company on record, according to Zephyr, the M&A database published by Bureau van Dijk. Zephyr shows 498 cash calls within this sector have been announced globally in 2019 to date; the largest is currently the USD 881.65 million fundraiser by Trada Alam Minera of Indonesia. © Zephus Ltd