Costain Shares Decline After ASGC Exits Investment

September 11, 2024 05:53 AM PDT | By Team Kalkine Media

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Costain Shares Decline After ASGC Exits Investment — Image source: Shutterstock

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In the Industrial sector, Costain experienced a notable drop in its share price on Wednesday following the sale of a significant stake by Dubai-based Al Shafar General Contracting Company (ASGC). The exit involved a placing of over 41.6 million shares to institutional investors.

Details of the Share Placing

The shares sold represented approximately 15% of Costain (OTC:CSGQF)'s issued share capital. The placing was executed at a price of 91p per share, with ASGC raising around £37.9 million in gross proceeds. The placing amount was increased by approximately 39% from the initially planned 30 million shares due to strong demand from investors.

Costain was not involved in the placing process and did not benefit from the proceeds of the sale. Following the announcement, Costain's shares were down 6.8%, trading at 97.80p as of 12:20 BST.

Market Response and Company Statement

A spokesperson for Costain commented on the development, noting that the increase in the number of shares placed reflected strong demand from institutional investors, including existing shareholders. The spokesperson highlighted the continued strong performance of the business, a high volume of forward work, and on-target margin growth as factors contributing to the increased demand.

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