Swiber aims to raise $45m via rights issue

The shares are almost 50% cheaper than its last traded price.

Swiber Holdings has proposed a renounceable rights issue to raise net proceeds of about $45m on the basis of one rights share for every two existing ordinary shares.

The issue price for each rights share is $0.15, which is at a discount of about 49% to the last traded price of $0.295 per share on 30 Dec.

According to OCBC, two major shareholders have undertaken to subscribe for an aggregate of up to 152.8m rights shares, or 50% of the maximum number of rights shares. 

“Though current share price valuations are low, we prefer to remain cautious due to 1) likely core net losses in FY14 and FY15, 2) uncertain order flows amidst a competitive and slowing industry, 3) accounts receivables that remain high, and 4) a steadily rising net gearing. Assuming that all the rights shares are taken up, our fair value estimate drops from S$0.34 to S$0.24 (based on 0.3x FY15 P/NTA),” stated OCBC.