Duxton Water Announces Successful Completion of $15 Mn Placement

April 18, 2019 04:02 PM AEST | By Team Kalkine Media
 Duxton Water Announces Successful Completion of $15 Mn Placement

On 18th April 2019, Duxton Water Limited (ASX:D2O) announced that it has successfully completed the placement, which saw strong demand from both institutions and professional, sophisticated investors. The company will undertake a subsequent Share Purchase Plan (“SPP”) to be offered to all eligible shareholders. Bell Potter Securities Limited (“Bell Potter”) acted as Lead Manager to the placement. The company has received firm commitments to raise $15 million through the share placement (“Placement”) pursuant to Section 708 of the Corporations Act (Cth) at an issue price of $1.48 per new share. The allotment of new shares is scheduled for Monday, 29 April 2019, pending final settlement of funds by Friday, 26 April 2019. To enable all shareholders to participate, the company will also implement a Share Purchase Plan, also at A$1.48 per share, to eligible D2O shareholders. The company will accept subscriptions of up to $15,000 from each shareholder under the SPP.

The funds raised will be used by Duxton Water to finalise already contracted assets in the pipeline, continue to acquire water entitlements in the Australian water market and cover costs associated with the entitlement offer. Excess funds, if any, will be used to repay the debt (~$60 million fully drawn) and general working capital requirements. The company observes a continued shift in demand from irrigators towards longer term water supply solutions and risk management tools, like allocation forward contracts and leases. These funds allow the company to continue to build the diverse water entitlement portfolio in a targeted way, to continue to meet this demand from its irrigation partners.

The placement raised A$15 million through the issue of 10,135,136 fully paid ordinary shares at $1.48 per share and was made to sophisticated investors eligible under section 708 of the Corporations Act (Cth). The issue price of $1.48 represents a 7.5% discount to the last traded price of $1.60 and a 7.1% discount to 10-day VWAP (A$1.593) up to and including the day before the issue price was determined (17 April 2019), and an 8.6% discount to NAV excluding provisions for unrealised gain (A$1.62 at 31 March 2019). The placement shares will be issued in accordance with the company’s available placement capacity under ASX Listing Rule 7.1. The new shares will rank equally with existing D2O ordinary shares quoted on the ASX.

The SPP will provide eligible shareholders with registered addresses in Australia or New Zealand with the opportunity to subscribe for up to $15,000 each in the company at $1.48 per share, the same as the placement. The books closing date for the SPP was close of business 17 April 2019. The SPP booklet is scheduled to be sent to shareholders on Monday, 29 April 2019. The director’s proposed to participate to the maximum extending permissible under the SPP, subject to any legal or regulatory requirements (including superannuation legislation and policy).

The company’s Chairman, Ed Peter, stated that they believe the greater size and scale of the company and the underlying portfolio will enable them to meet the increasing customer demand for further water supply offerings to their irrigator customers. The increased scale will have a positive impact on their existing shareholders as it should create a more diverse register, greater liquidity and with a larger portfolio of assets, greater return capability. The group wants to make sure that all of the existing shareholders are also looked after when they do a capital raise. D20 want their shareholders to be able to participate, to grow their holding, or to at least maintain their position. Mr. Peter further stated that the company is very scalable, and with the emerging demand yet to really be factored into the value of the water entitlements, management thinks that there is still further capital and yield growth opportunity for them.

At the time of writing (on 18th April 2019, AEST: 03:36 PM), the stock of Duxton Water was trading at $1.580, down 1.25% with a market capitalisation of ~$173.89 million. Its current PE multiple is at 18.82x, and its last EPS was noted at $0.085. Today, it touched day’s high at $1.58 and day’s low at $1.56, with a daily volume of 134,075. Its 52 weeks high was at $1.67 and 52 weeks low at $1.062, with an average volume of 98,473. Its absolute return for one year, six months and three months are 47.27%, 19.11%, and 13.88%, respectively.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.


Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.


AU_advertise

Advertise your brand on Kalkine Media

Sponsored Articles


Investing Ideas

Previous Next
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.