Super Retail Raising Struggles While Investors Stampede Kogan
PUBLISHED
2020-07-09
Content
Mixed reactions continue from retail shareholders in companies doing capital raisings - some like it “hot” so to speak such as the National Australia Bank, others are indifferent, for example Southern Cross Austereo.
Yesterday we saw two conflicting outcomes from retail issues - Super Retail Group attracted support from around two-thirds of its retail shareholders while online retailer, Kogan.com had to increase the size of its issue after being knocked down in the rush.
Super Retail Group said 69% of eligible shareholders had participated in its $44 million retail entitlement offer with around 4.1 million new shares were issued at $7.19 each.
The remaining 31% was allocated to sub-underwriters. Alongside its institutional offer, Super Retail successfully raised $203 million from shareholders.
Super Retail shares fell nearly 5% yesterday to $7.90 meaning retail shareholders are in the money by around 70 cents a share.
Chief executive Anthony Heraghty said he was pleased with the level of support the company had received from retail shareholders.
But a very different outcome for Kogan which was forced to lift its retail issue by $5 million to $20 million.
The company was knocked down by a total of $115 million in offers for the original $15 million issue at $11.45 each.
The issue price was a 7.5% discount to Kogan’s $12.38 share price in early June, however, the shares have jumped to $16.46 yesterday, giving all participants an immediately in-the-money gain of $5 a share.
Due to the level of demand, Kogan scaled back the offering, limiting shareholders to an allotment of just 13% of their shareholding.
This means eligible shareholders will now receive just one share for every eight they own.