LONDON (Alliance News) - Manufacturing and specialist services company Redhall Group PLC on Friday said it has launched a placing and open offer to raise up to GBP5.8 million to cut its debt pile.
Redhall said it will raise the funding by issuing 115.3 million shares at 5.0 pence per share. Redhall shares closed at 10.125 pence on Thursday, meaning the issue comes at a significant discount.
Redhall said the placing and open offer, together with a debt conversion it has agreed with Henderson and HSBC Bank PLC, will result in its group debt being reduced by up to GBP8.3 million.
Under the debt conversion, Redhall said Henderson and HSBC have agreed for GBP3.0 million of the Henderson debt to be converted as consideration for the issue of 41.5 million shares and the grant of 18.5 million conversion options.
The company said the extra funding flexibility will back the growth of its existing businesses and the first stage of its turnaround programme.
"We have made significant progress in the past year in transforming Redhall into a company focused on multi-disciplinary manufacturing and specialist services, which offer higher margins and lower risks. The proposals announced today, through restructuring the balance sheet and providing additional funding, will position Redhall to take advantage of the significant growth opportunities in our marketplace," said Redhall Chief Executive Phil Brierley.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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