Feb 28 Structural steelwork maker
Severfield-Rowen Plc said it planned a rights issue
priced at a 67.8 percent discount to the company's closing stock
price on Wednesday, sending its shares down as much as 15
percent in early trading.
The company, which also reported an underlying pretax loss
of 19.6 million pounds ($29.7 million) for 2012, said it planned
to raise a net 44.8 million pounds through the 7-for-3 issue.
The issue of up to 208.25 million shares would be priced at
23 pence each, the company said. The shares closed at 71.5 pence
on the London Stock Exchange on Wednesday.
Severfield-Rowen said it would use the proceeds from the
issue to strengthen its balance sheet. The company had net debt
of 29.7 million pounds at Dec. 31.
Executive Chairman John Dodds said the loss for the year was
primarily the result of "an unacceptable level of performance on
a small number of contracts."
The company, which recorded a pretax profit of 10.1 million
pounds in 2011, said in January that Chief Executive Tom Haughey
would step down after cost overruns at one of its projects in
Severfield-Rowen said last week that its expectations for
2013 and 2014 were now lower.
The company's shares were down 6.3 percent at 67 pence at
0843 GMT on the London Stock Exchange.
($1 = 0.66 British pounds)
(Reporting by Brenton Cordeiro in Bangalore)