News blog
InterBulk Group
- BY: Andrew Hore |
- POSTED: 20/05/2011 |
Intermodal transport equipment and services provider InterBulk Group is raising £18.15m via a placing at nearly three times the share price prior to the announcement and this should cut annual interest costs by £2.8m.
China-based transport group Sinotrans is buying all the shares for 11p each, although existing shareholders will need to agree to the deal. A meeting will be held on 7 June to gain shareholder approval. They also have to approve Sinotrans taking a 35.3% stake without having to make a bid for the other shares.
Shares in InterBulk have subsequently doubled to 7.75p each, which values the existing share capital at £23.5m.
Prior to this placing, Atorka owned 40.8% of InterBulk. Along with Groupe Norbert Dentresangle, Atorka is voting in favour of the fundraising. Adding the holdings of the directors, this provides support for the resolution equivalent to 58.2% of InterBulk. However, 23% shareholder and competitor Hoyer GmbH Internationale Fachspedition is not in favour of the deal.
That dissenting shareholder could have blocked the deal and that is why the placing is being done as a cash box placing that does not require shareholders to vote in favour of disapplying pre-emption rights. In effect, Sinotrans is investing the cash in a new subsidiary and then swapping that investment for shares in the company. That will leave InterBulk with a subsidiary with a large cash holding.
The German competition authorities also have to give their blessing to the placing.
InterBulk has been weighed down by high borrowings and that has pushed down its share price. The bank facilities were due for renegotiation in September 2012.
The cash will be used to repay a large chunk of the most expensive debt, which has an interest charge of LIBOR plus 12 percentage points. There was £37.4m of this mezzanine debt at the end of September 2010. A further £5.1m of mezzanine debt will be converted into a Term B loan lasting until June 2013. The Bank of Scotland will also cancel its warrants and waive a deferred fee of £471,000. Net debt will be cut by 16%.
Linking up with Sinotrans also provides impetus to InterBulk’s attempts to grow in China. The two companies have already worked together on chemical transportation and storage projects. This is what sparked Sinotrans’ interest in investing in InterBulk.
Sinotrans is involved in freight forwarding, shipping agency, liner services and terminal services. Sinotrans made a profit of nearly £101m on revenues of £4.07bn in 2010.
Sinotrans can appoint a director to the InterBulk board as long as it owns at least 15% of the company.
InterBulk will report interim figures on 14 June and these should be in line with expectations. Demand from the chemicals sector is buoyant. The figures are already benefiting from previous reductions in interest rates.
Download the May 2011 edition of AIM Journal at http://www.hubinvest.com/AIMPDFMay2011_20.pdf
© 2024 Aim Micro. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
- Browse by issue
- All issues
- Popular tags
- All tags
- AIM Micro feeds
Keep up to date with articles published at AIMMicro.com. Subscribe to AIM Micro RSS Feeds
|