Cochlear announces $800 million capital raise to ride out market uncertainty

Cochlear announces $800 million capital raise to ride out market uncertainty

Australian hearing implants business Cochlear (ASX: COH) hopes to raise $800 million to ensure it remains strongly capitalised during the economic fallout of Covid-19.

Many elective surgeries, including Cochlear's own implant surgeries, have been deferred as hospitals around the world ramp up treatment efforts for the novel coronavirus.

This has caused "significant business disruption" for Cochlear and the company hopes an $800 million injection of capital will ensure the group can bounce back once elective surgeries resume.

The company says it anticipates losses from these deferred surgeries will be recovered upon recommencement.

Cochlear will use the $800 million to fortify its balance sheet enabling the company to navigate market uncertainties while continuing to reinvest and reinforce its position as the global leader in hearing implant solutions.

Its plea to potential investors reiterates the business case that has seen Cochlear become one of Australia's leading med-tech companies.

As the global leader in heating implant solutions Cochlear holds an estimated 60 per cent market share in implantable hearing solutions with more than 600,000 implants sold in the last 40 years.

The placement will be conducted at $140 per new share, which represents a 16.7 per cent discount to the last closing price of $168 per share on Tuesday 24 March.

Approximately 5.7 million new shares will be issued as part of the raise, representing 9.9 per cent of the company's existing issued capital.

"To ensure we emerge from this global health pandemic in an even stronger competitive position than before, we are strengthening the balance sheet by raising equity," says Cochlear chairman Rick Holliday-Smith.

Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.

Business News Australia

Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

Five treatments to rejuvenate and brighten your skin without the hassle
Partner Content
Between working from home and Winter weather, our skin has seen better days. But with ...
Dr Lanzer Skin Clinics
Advertisement

Related Stories

Byron and Tweed to exit lockdown tonight

Byron and Tweed to exit lockdown tonight

The New South Wales north coast regions of Byron and Tweed will exi...

Mask rules change and jabs soon mandatory for truck drivers after QLD reports four new cases

Mask rules change and jabs soon mandatory for truck drivers after QLD reports four new cases

With Queensland today reporting four new locally acquired cases of ...

Rapid antigen tests have long been used overseas to detect COVID. Here’s what Australia can learn

Rapid antigen tests have long been used overseas to detect COVID. Here’s what Australia can learn

Australian Health Minister Greg Hunt wants COVID-19 rapid antigen t...

Patrick Terminals sounds alarm over October strikes, but union dismisses "exaggerated" claims

Patrick Terminals sounds alarm over October strikes, but union dismisses "exaggerated" claims

Patrick Terminals has issued a notice to customers today about a ra...