27th Mar 2020 11:39
(Alliance News) - City Pub Group PLC said Friday it has raised GBP15 million through a share placing, which will go towards strengthening the company's balance sheet amid an ongoing suspended trading environment caused by the Covid-19 outbreak.
The pub owner placed 30.0 million shares at a price of 50 pence per share, reflecting an 11% discount to the company's closing price on Thursday of 56.00p.
Shares in City Pub were 19% higher at 66.48 pence on Friday in London.
In addition to the placing, City Pub is also looking to raise another GBP7.0 million in an open offer through the issue of 14.0 million shares at the same price per share as the placing.
In addition to bolstering its balance sheet, proceeds from the fundraising will also go towards positioning City Pub to expand its portfolio of pubs at a time when acquisition prices will be reduced in the short-term.
Liberum Capital Ltd acted as sole bookrunner for the placing.
Completion of the placing and open offer is now subject to shareholder approval being gained at a general meeting due to be held on April 16.
"We are delighted with the investor support we have had at this difficult time. Together with our existing funding arrangements, this significantly strengthens our balance sheet providing a further cushion in the event the suspended environment is extended. The additional funds will also allow improvements to our operational structure during the period of closure and enable us to grow the business and recover shareholder value once pubs are permitted to reopen," said Executive Chair Clive Watson.
By Dayo Laniyan; [email protected]
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