Appen’s Shares Slipped Around 7% On ASX Post Announcement Of Underwriting $285 Million Institutional Placement

Appen’s Shares Slipped Around 7% On ASX Post Announcement Of Underwriting $285 Million Institutional Placement

Appen Limited (ASX: APX) is into the operations of developing human annotated datasets used for machine learning and artificial intelligence globally, which are superior in quality. It is leading in its segment with over twenty years of experience in collection and enriching a wide variety of data types which includes speech, text, image and video. It has leading technology, automotive and eCommerce companies, as well as governments worldwide as its partner, which the company helps to develop, enhance and use products that rely on natural languages and machine learning, with its depth in expertise in more than 180 languages which reaches to a global crowd of over one million skilled contractors.

The company today on 12 March 2019, announced that it has completed the underwriting of A$285 million institutional placement at an offer price of A$21.50 per new share. The proceeds from the placement are to be used to fund the upfront consideration payable by Appen for the acquisition of Figure Eight Technologies, Inc., that was announced on ASX on Monday, 11 March 2019.

As per Mark Brayan, the Managing Director and CEO of the company, the existing institutional shareholders of the company supported the placement, and several new institutional investors also joined. The settlement date for the placement is tentatively on Friday, 15 March 2019 with the allotment likely to be scheduled on Monday, 18 March 2019.

New shares issued under the placement will otherwise rank equal with existing Appen ordinary shares on issue, except that the new shares will not be entitled to the FY18 final dividend declared by the company and are scheduled to be paid on 25 March 2019.

The SPP will provide each eligible shareholder with the opportunity to apply for up to $15,000 of new Appen shares at the lower of  the placement price (being $21.50), or the price that is a 2% discount to the VWAP of Appen shares on ASX over the five trading days up to, and including, the closing date of the SPP.

A$15 million will be raised maximum through the SPP and applications that exceed that amount will be scaled back. The SPP offer booklet containing further details regarding the SPP Offer, including the terms and conditions for participation, will be lodged with ASX tentatively on Wednesday, 20 March 2019 and will be despatched to eligible shareholders in Australia and New Zealand at that time.

On the price-performance front, the stock of Appen Limited is currently trading at $22.510, decreased by ~7.632% during the day’s trade, with a market capitalisation of $2.6 billion (AEST 02:47 PM). The stock has generated significant YTD return of 90.39% and returns of 72.35%, 93.26% and 40.54% over the past six months, three months and one-month period, respectively. It had a 52-week high price of $25.610 and a 52-week low price of $8.590, with an average trading volume of 775,016. The PE multiple for the stock is 62.09x with earnings per share (EPS) of AUD 0.393. The annual dividend yield, however, is 0.33 per cent.


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