Turners Automotive plans to raise $30M to fund growth

Turners Automotive plans to raise $30M to fund growth, improve liquidity

By Tina Morrison

Sept. 13 (BusinessDesk) - Turners Automotive Group intends to raise as much as $30 million by selling new shares to help fund future growth and provide more liquidity for its stock.

The Auckland-based company will raise $25 million through the placement of new ordinary shares at $3.02 apiece, which will be fully underwritten by the sole lead manager UBS New Zealand. It also plans to raise as much as $5 million through a non-underwritten share purchase plan which will be offered to eligible shareholders and convertible bond holders, it said in a statement.

Its shares have been halted from trading on the NZX and ASX pending completion of the placement. They last traded at $3.36 on the NZX. No price was available from the ASX where the stock was admitted for trading as a foreign exempt listing on July 27 to give it access to a larger capital market to support its growth.

Turners said the funds raised from the share sale will provide it with capital for investment to fund strategic growth opportunities, including continued expansion of its finance book, which is adding about $10 million of receivables per month. It will also allow it to pursue strategic dealer and property acquisitions to grow the distribution network and capabilities of the automotive retail division, and increase its free float, providing greater liquidity for Turners' investors and broadening the company's share register by introducing new shareholders.

"The equity raising will enable Turners to fund its rapidly growing finance receivables, as well as provide capital for further strategic property and dealership acquisitions," said chief executive Todd Hunter. He noted that the company's recent acquisitions of Buy Right Cars and Autosure Insurance are both performing ahead of expectations.

Turners said the new shares will be entitled to receive the company's dividend for the first quarter of the 2018 financial year, which is expected to be no less than the year earlier 3 cents per share payment, provided they are held on the dividend record date.

ENDS

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