LONDON (Alliance News) - Cobham PLC on Wednesday set out the terms of its discounted, fully-underwritten rights issue, first announced in April with the aim of shoring up its finances.
The FTSE 250-listed company, which makes satellite communications equipment, microelectronics products and air-to-air refuelling technology for the aviation, maritime, defence and space sectors, tabled plans for the rights issue in late April after issuing a profit warning for 2016 following weak trading in the first quarter.
On Wednesday, Cobham said it will launch a fully-underwritten, one-for-two rights issue to raise GBP506.7 million. The company will issue 569.3 million shares at 89.00 pence per share, a 45% discount to its closing price on Tuesday of 163.49p.
The issue is underwritten by Bank of America Merrill Lynch and Jefferies International.
Cobham said it intends to reduce its indebtedness with the proceeds from the rights issue and said the move will allow it to focus on its development programmes in order to insulate the business from short-term market challenges.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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