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FKP will raise $232 million to pay short-term debts and position itself for its planned push into aged care.
The 5 for 9 share offer is for existing holders only, with the new shares offered at $1.30 each, a 36 per cent discount on the stock’s $2.03 closing price on October 25.
FKP is in a trading halt today as a result of the announcement.
Mulpha, FKP’s largest shareholder with a 26.5 per cent stake, has committed to take up its full entitlement. It has also committed to sub-underwrite an additional amount of up to $20 million of the offer.
FKP says the venture will improve its capital position while also positioning it to realise its goal of becoming a retirement developer, manager and owner.
“Following a detailed review of the business, capital structure and obligations of FKP, it was determined that an equity raise provided the best path forward to enable FKP to de-lever and meet its short-term debt maturities while better positioning the company to deliver on its pure play retirement operator strategy,” says FKP chief executive officer Geoff Grady (pictured).
FKP recently announced the sale of 50 per cent of its interest in The Milton, a 309 apartment development project in Brisbane for $28 million and a 14 hectare piece of land at Point Cook in Victoria for $18 million, again to pay off debts and invest in future retirement developments.
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