CapitaLand said on Monday it would spend about S$330 million to fully subscribe to its entitlement in Australian unit, AustraLand’s rights issue.
AustraLand had announced a 7 for 10 rights issue at an issue price of 40 Aussie cents or about 47 Singapore cents. This is a 20 per cent discount from the firm’s last trading price of 50 Aussie cents a share.
CapitaLand owns about 59 per cent of AustraLand and its stake in the unit is not expected to change upon the completion of the rights issue.
AustraLand aims to raise around A$475 million from the rights issue. It also announced a net loss of A$269 million for the half year ended in June, compared with last year’s net profit of A$25.5 million.
CapitaLand said the current weak environment in Australia is largely due to the uncertainties in the global financial markets.
It remains confident of the future economic growth of the country, adding that the proceeds from the rights issue will strengthen Australand’s balance sheet.
Source : Channel NewsAsia – 27 Jul 2009