ROCK breaker and drilling contractor Brandrill will raise $14.9 million in a three-step capital raising pitched at just 5¢ per share in bid to extricate itself from its financial difficulties and stave off liquidation.
The Pinjarra-based firm yesterday said it had finalised its plans to close out a $15 million finance facility with the Commonwealth Bank and fund a much-needed overhaul of the group.
Under the terms proposed, Brandrill will raise $7.8 million through a pro-rata rights issue to existing shareholders underwritten by Foster Stockbroking, up to $5.1 million through an underwritten placement to Foster clients, and the equity conversion of $2 million in short-term debt owed to directors and associates related to interim funding offered last month.
Instead of shares, the capital raising will involve the issue of mandatory converting notes at 5¢ each, less than a third of Brandrill's 17.5¢ close when its stock was suspended on June 11.
The notes carry an 8.5 per cent coupon rate and are convertible into as many as five Brandrill shares up until the end of September 2005, with the conversion ratio to be determined by Brandrill's share price at the time.
Each note also carries a free option convertible into one Brandrill share at 10¢ over the same three-year period and may be redeemed by Brandrill at any time.
