LONDON (Alliance News) - Stobart Group Ltd said Friday it will raise GBP53.1 million through the issue of five-year secured guaranteed exchangeable bonds by subsidiary Stobart Finance PLC.
The aviation, energy and civil engineering group said net bond proceeds will be used to support the company's growth plans for aviation and energy.
The bonds will be issued at par and will bear interest at 2.75% per annum, payable semi-annually in arrears in equal instalments. The bonds are guaranteed by the company and will be exchangeable into ordinary shares of Eddie Stobart Logistics PLC at an initial exchange price of GBP1.1875, a 25% premium to the reference price of GBP0.95.
Eddie Stobart Logistics shares were down 1.0% on the day Friday at 97.50 pence. Shares in Stobart Group were trading 0.1% higher at 149.20p.
"Stobart Group is focused on accelerating the growth in its core Aviation and Energy divisions. These divisions require further investment in order to optimise shareholder returns on a sustainable basis. The group has reviewed its capital requirements and the most effective use of its assets and investments in order to achieve this aim. The issuance of this bond allows Stobart Group to realise the value of its interest in Eddie Stobart Logistics while protecting the long-term interests of shareholders," Chief Executive Warwick Brady said.