Viva Energy Unveils Its Security Purchase Plan Capped At $10 Million

Viva Energy Unveils Its Security Purchase Plan Capped At $10 Million

On 5 March 2019, Viva Energy REIT (ASX: VVR) launched the Security Purchase Plan to raise up to $10 million in order to fund support its acquisition transactions.

The company told that each of its eligible shareholder in Australia and New Zealand can apply for up to $15,000 worth of its new shares at a discounted price of $2.32 per share under the Security Purchase Plan. Further, the shares will be issued in Viva Energy REIT Limited stapled with units in the Viva Energy REIT Trust without any brokerage or transaction cost attached to it. 

Viva’s intention to raise capital via institutional placement and Security Purchase Plan was first announced on 21 February 2019. As of date, the company has already raised approximately $100 million under the Institutional Placement offer at a price same as SPP, representing a discount of 3.5% to the five day volume weighted average price of VVR stapled securities traded on the Australian Securities Exchange over the five consecutive trading days ending on 20 February 2019, being the trading day immediately preceding the date the SPP was announced.

On the completion of this capital raising programme, the company intends to utilise the proceeds to partially fund the 8 acquisitions totalling approximately $47 million completed in second half of Fiscal Year 2018 along with providing headroom for future growth.

The report read that SPP is not underwritten and is optional and open to eligible security holders of Australia or New Zealand who were present on the company’s registry on the record date of 20 February 2019.

Viva Energy told that if the total value of the Security Purchase Plan exceeds the upper limit of $10 million, it reserves the right to scale back the maximum number of New Securities issued to each eligible security holder at its absolute discretion. In such a case, the shareholder will be allocated the new securities to a value of less than they have applied for and the difference amount, above $2, will reportedly be refunded without any interest.

The closing date for SPP is scheduled to 19 March 2019 while the issuance of new securities under the plan is expected to take place on 26 March 2019. It was further explained that certain eligible custodians can also participate in the SPP on behalf of their beneficiaries, subject to terms set out in this Booklet.

As per the company’s information, new securities issued under the SPP will rank equally with existing securities and will be entitled to any distribution for the six months ending 30 June 2019.

In today’s trading session, VVR traded near to its 52-week high of $2.470 with the intra-day change of +2.075% or $0.050 to close at $2.460 on 5 March 2019. The stock last traded at a Price to Earnings multiple of 10.470 x with a market capitalisation of $1.85 billion.

Over the past 12 months, the stock has returned the yield of massive 21.41% with the favourable price movement of 14.76% in the past three months.


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