Lendlease to raise $1.15 billion

Lendlease to raise $1.15 billion

Property project developer Lendlease (ASX: LLC) has today joined the wave of Australian companies raising enormous amounts of capital to ride out the Covid-19 crisis, with plans to dilute its shareholdings by up to a fifth to secure more cash.

This morning the company announced plans for a $950 million fully underwritten institutional placement at $9.80 per share, representing an 8.2 per cent discount to the last trading price.

The placement is set to be issued on 4 May, and will be followed by a share purchase plan (SPP) that closes on 26 May with more than 20.4 million shares on offer.

If the SPP is successful it would add an extra $200 million to the raising, taking the total to $1.15 billion.

Lendlease says the capital raising will position the company well for its $100 billion urbanisation pipeline as well as a pipeline of around 48,500 land lots for its Communities projects.

"This equity raising, coupled with the actions we have already taken, will strengthen the Group's balance sheet position during this uncertain economic environment with available liquidity increased to $3.95 billion, support the delivery of the Group's $112 billion global development pipeline and provide additional flexibility and capacity to pursue further investment opportunities," says Lendlease CEO Steve McCann.

The company has either deferred or reduced non-essential capital expenditure and project expenditure, while senior executives' fixed remuneration has been cut by 20 per cent with some of the savings to go into an employee hardship and wellbeing fund.

That fund will also be topped up by non-executive directors reducing their base fees by up to 20 per cent.

Lendlease is yet to decide whether a final dividend for FY20 will be paid from Lendlease Corporation Limited.

The group says it will continue to explore capital partnerships to deliver its extensive urbanisation portfolio of 21 major projects safely, sustainably and profitably. Recent developments on its projects include:

  • Conditional framework agreement reached to form a 50/50 investment partnership with a capital partner for Milan's Milano Santa Giulia project to develop the $4 billion project over 15 years including the Group selling the first two office buildings to the investment partnership;
  • An additional residential for rent building at London's Elephant Park anticipated to enter delivery in H2 FY20 with capital partner and planning approval having been obtained;
  • One Sydney Harbour presales currently total $1.5 billion representing over 75 per cent of the first tower, and PLLACes together with capital partnership options continue to progress well; and
  • Tower One at TRX Residences, Kuala Lumpur pre-sales currently exceed 50 per cent.

Capital raising activity has been in overdrive since the Covid-19 pandemic began, with motives ranging from sheer survival to precautionary raisings to bolster balance sheets for the year ahead. Here are some of the leading raisings to date:

Updated at 9:40am AEST on 28 April 2020.

 

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

Crypto staking: a new way to earn passive income
Partner Content
You may be familiar with traditional ways of earning passive income such as trading sto...
Etoro
Advertisement

Related Stories

Blackstone waits on gaming authorities as Crown shareholders approve $8.9b buyout

Blackstone waits on gaming authorities as Crown shareholders approve $8.9b buyout

Shareholders of Crown Resorts (ASX: CWN) have voted in favour of th...

Carsales.com founders sell Melbourne office development for $60.25m

Carsales.com founders sell Melbourne office development for $60.25m

A Singapore-listed property trust managed by Frasers Property (SGX:...

Woolworths adds controlling stake in MyDeal to cart for $218 million

Woolworths adds controlling stake in MyDeal to cart for $218 million

Woolworths (ASX: WOW) is looking to enhance its online marketplace ...

SNL’s Pete Davidson to star in QLD feature film ‘Wizards!’

SNL’s Pete Davidson to star in QLD feature film ‘Wizards!’

The Australian screen sector has bagged two major wins today, with ...