The remaking of Fleetwood Corporation continues.
After revealing plans to sell its troubled Forrestfield, WA caravan manufacturing business at the end of this year, the company revealed plans yesterday for a $60 million fund raising to help finance two East Coast acquisitions.
Perth-based Euroz Securities was offering 12.2 million new shares to institutional clients at $1.80 each, to raise $22 million via an accelerated placement. The rest will follow from a $38 million entitlement issue to other shareholders.
The offer price is a 12% discount to Tuesday’s closing price of $2.04. Trading was halted to allow the issue to take place.
Fleetwood told the ASX yesterday it had made deals to buy Sydney modular building company MBS for at least $34 million and Melbourne caravan plumbing and electrical parts maker Northern RV for at least $10 million.
“MBS provides Fleetwood with a large and modern facility in the key western Sydney market that has forward contracted government commitments in the growing corrections sector,” Fleetwood managing director Brad Denison said in yesterday’s statement.
“As well as allowing Fleetwood to enter a new sector that has economic and political tailwinds, the acquisition will provide Fleetwood an opportunity to participate in the large upcoming education spend in NSW.” he said.
Mr Denison said plumbing parts maker NRV would be bolted on to Fleetwood’s Camec caravan parts business. He said “The combined transactions are strongly EPS and ROE accretive and will leave Fleetwood with a balance sheet capable of funding future growth."
Fleetwood saids MBS financial year 2018 revenue was $49.6 million and earnings before interest tax and amortisation (EBITA) was $9.4 million before adjustment for likely costs under Fleetwood ownership and NRV had revenues $15.7 million and EBITA of $4.7m before adjustment for likely costs under Fleetwood ownership.
