Wagners to raise $40m ahead of US plant expansion
TOOWOOMBA company Wagners Holding Company plans to raise $40 million in equity from a new share offering to fund its expansion into the United States.
The construction materials business will issue a fully underwritten pro-rata offer of about 25 million new Wagners shares, at $1.55 per new share.
According to the offering by the company, the move will be used to both reduce debt and fast-forward the expansion of its upcoming composite fibre technology plant in the US.
The facility will be located in either Wyoming or Texas, with Wagners expected to announce its decision next week.
"Net proceeds raised under the offer will be used by Wagners to repay debt and strengthen the balance sheet for future near-term growth opportunities (like) accelerating expansion of the CFT business in the USA (and) the rollout of additional concrete batch plants in the southeast Queensland construction materials market," the ASX announcement read.
The Wagner family will buy 55 per cent of the shares available, in line with its current ownership ratio in the company.
Wagners CEO Cameron Coleman said the new pultrusion machine to be shipped to the United States was already built.
"The machine is finished and being containerised as we speak," he said.
"We'll be able to announce soon when it's going and where we're shipping it to."
The share issuing will increase the company's net assets to $102 million, while reducing its liabilities to $50 million.
Wagners also announced it had started supplying cement again to competitor Boral, after the agreement was suspended earlier this year over a pricing dispute.
That dispute is currently before the Queensland Supreme Court, with a hearing set for November.
Mr Coleman confirmed it was Boral who recommenced the supply agreement.
The saga with Boral, along with timing delays on certain infrastructure projects, were major hits to the company during the previous financial year.
Shares in the company improved to $1.80 as of yesterday afternoon, after reaching a new low on $1.42 in August.