- Kina Securities (KSL) will undertake a $91 million capital raise, its first in almost five years
- The company froze its shares in a trading halt this morning before quickly announcing details of the capital raise
- It plans to undertake an entitlement offer, placement and a non-underwritten PNG offer
- 113.5 million new shares will be issued under the capital raise at a discounted price of 80 cents each
- Kina is undertaking the capital raise in order to better capitalise on growth opportunities within its customer base
- Shares in the company will remain locked up until September 14, at which point the placement and entitlement offer will be completed
- Kina’s stock last traded for 93.5 cents each on September 9
Financial services company Kina Securities (KSL) will undertake a $91 million capital raise, its first in almost five years.
Besides a $10 million strategic investment by the Asian Development Bank (ADB) late last year, this is Kina’s first equity raise since its initial public offering (IPO) in 2015.
Equity raise
In total, Kina plans to raise $91 million through a number of components.
These include a $10.5 million underwritten institutional placement, and a $70 million underwritten one-for-two accelerated pro-rata non-renounceable entitlement offer.
The entitlement offer has both a retail and institutional component. The institutional offer and placement will be conducted by way of a bookbuild that will open and close today.
Meanwhile, the retail component will open on September 17, and remain open until October 1.
Finally, Kina will also offer a non-underwritten PNG offer to eligible PNG shareholders to raise an additional $10.5 million. The details of the offer will be dispatched in mid-October.
Under all of the offers, shares will be priced at 80 cents each — a 14.4 per cent discount to the company’s last traded price of 93.5 cents.
113.5 million shares will be issued under the capital raise, representing around 65 per cent of Kina’s existing shares on issue.
Funding growth
In explaining the reason for this capital raise, Kina said it had identified a number of growth opportunities within its customer base.
“Kina Bank continues to see significant additional growth opportunities, both organic and inorganic, across its new and existing customer base both in terms of additional services from existing clients and market share gains from competitors,” the company said in a statement.
It said this capital raise will ultimately help the company strengthen its capital base, regulatory ratios and provide for strong growth in the short and long term.
Shares in Kina Securities will remain locked up until Monday, September 14, at which point both the placement and entitlement offer will have been completed.
Kina’s stock last traded for 93.5 cents each on September 9.