LendLease Group aims to raise about $1.15 billion to guard against market uncertainty brought about by the coronavirus outbreak and has withdrawn all forecasts provided with its first-half results.
The construction firm says it will raise $950 million in new equity via a fully underwritten share placement and up to $200 million through a non-underwritten share purchase plan.
Companies in Australia and New Zealand have largely turned to equity markets to raise nearly $12 billion to boost liquidity and calm nerves among investors fretting about the virus impact.
LendLease’s share placement will be at a price of $9.80 per share, an 8.2 per cent discount to the stock’s Monday close.
Chief executive Steve McCann says the equity raising will strengthen the company’s balance sheet “during this uncertain economic environment”, support delivery of its pipeline and provide flexibility to purse further investment opportunities.
In February, the company reported a surge in first-half profit after tax, helped by the sale last year of its struggling engineering business to Acciona Infrastructure Asia Pacific.
The Sydney-based company on Tuesday said reduced productivity in its construction segment could have a short-term impact on full-year core profit, while the impact of revaluations on its investment segment was uncertain.
LendLease also said senior executives and non-executive directors would take pay cuts.