A leading global network as a Service provider, Megaport Limited (ASX: MP1) has announced that it will raise up to $50 million in new equity via a fully underwritten placement to institutional, experienced, sophisticated and professional investors (Placement). The company will raise further $10 million through a Share Purchase Plan following the Placement (Capital Raising).
Megaport has entered into a trading halt pending the release of an announcement regarding the completion of the placement.
Megaport is undertaking the Capital Raising to accelerate its plans for expanding to new locations and new markets, undertake capacity upgrades, fund innovation and development of new technology and fund operating costs and general working capital requirements. This capital raising will allow the company to innovate new services and capabilities and achieve greater ecosystem density and choice by integrating with leading service providers. The capital raising will ensure that the company’s services-neutral platform is positioned for future growth as data consumption increases.
Megaport is planning to issue 12.5 million fully paid ordinary shares in Megaport (Shares) under the Placement at an issue price of $4.00 per Share, representing a 4.8% discount to the closing price of $4.20 per Share on 12 March 2019.
To further assist the company in improving liquidity, the company’s Chairman, founder and major shareholder Mr. Bevan Slattery has agreed to offer up to 5 million Shares to institutional, experienced, sophisticated and professional investors via an underwritten secondary offering. The shares under the secondary offering will be sold at the same price as the Shares issued under the Placement.
It is expected that the settlement of the placement and secondary offering will occur on 19 March 2019. Further, the allotment of the placement shares will happen on 20 March 2019.
The company has also announced a share purchase plan under which each eligible shareholder in Australia and New Zealand will be offered to apply and subscribe for up to $15,000 of new Shares, up to a total cap of $10 million.
The SPP Shares will be issued at the lower of the Issue Price and the price equal to the volume weighted average price of Megaport Shares traded on ASX for the 5 trading days ending on the closing date of the SPP offer. The SPP offer will close on 26 April 2019, and the allotment of shares is expected to happen on 3 May 2019.
Now, let’s have a glance at the company’s stock performance and the return it has posted over the past few months. The stock last traded at a price of $4.200 with a market capitalization of ~$499.87 million. The stock has provided a year till date return of 12.30% & also posted returns of 19.66%, 10.24% & 5.53% over the past six months, three & one-months period respectively. It had a 52-week high price of $4.560 with an average volume of ~ 234,332.
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