| Queensland
based automotive parts maker CMI Limited today announced details of
a non-renounceable entitlement issue of new convertible preference shares
to shareholders to raise approximately $11,000,000.
In a Prospectus lodged with ASIC today CMI said the funds raised would
be used to reduce borrowings incurred by its acquisitions in late 2002
of Toowoomba Metal Technologies and National Forge, and to accelerate
its domestic and international market expansion.
CMI recently reported a 21% increase in profit after tax to $2.5 million
for the six months ended 31 December 2002, on the back of a 25% climb
in revenue to $79.6 million.
The company says the two acquisitions have combined annualised sales
of $60 million and will make a first time contribution to group earnings
in the six months to 30 June 2003.
CMI is offering both ordinary shareholders and existing convertible
preference shareholders one new convertible preference share at $1.45
for every six ordinary or convertible preference shares held at a record
date of 24 April. Approximately 7,587,250 new convertible preference
shares will be issued under the Prospectus, resulting in CMI having
27,036,382 ordinary shares and 26,074,364 convertible preference shares
on issue.
The new convertible preference shares are being offered on the same
terms as the convertible preference shares currently on issue (CMIPB),
boasting an escalating, high yield income stream with forecast fully
franked dividends paid in quarterly instalments as follows:
- 12 months ended 21
May 2004 -
13.0625 cents (9%*)
- 12 months ended 21
May 2005 -
13.8125 cents (9.53%*)
- 12 months ended 21
May 2006 -
14 cents (9.66%*)
*Yield based on issue price of $1.45 per share
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The
offer is fully underwritten by ABN AMRO Morgans Corporate Limited. Important
dates with respect to the issue are as follows:
| Lodgement
of prospectus |
10 March
2003 |
| Record date |
24 April 2003 |
| Issue opening date |
28 April 2003 |
| Issue closing date |
16 May 2003 |
| New convertible
preference shares trading on deferred settlement basis |
19 May 2003 |
| Date for dispatch
of statement of holdings for new convertible preference shares |
23 May 2003 |
| Commencement of
trading of new convertible preference shares on normal T + 3 basis
|
26 May 2003 |
CMI’s executive
chairman, Max Hofmeister said the decision to undertake the capital
raising through convertible preference shares accounted for the company’s
predominantly smaller shareholder base.
“It has been evident through CMI’s previous issues of this
category of equity that many of our shareholders have a clear cut preference
for the regular, increasing income streams from convertible preference
shares,” he said.
Mr Hofmeister said the company, buoyed by expanding supply arrangements
with the Australian and US automotive sectors, and its two recent acquisitions,
was confident of achieving strong earnings growth for the full year
to 30 June 2003 and anticipates breaking the $200 million revenue barrier
in the 2003/2004 year.
Mr Hofmeister said CMI would be seeking shareholder approval at General
Meetings of its ordinary and Convertible Preference Shareholders on
11 April to amend the company’s constitution to enable convertible
preference shareholders to participate in the proposed entitlement issue
of new convertible preference shares.
CMI expects to dispatch prospectuses to shareholders on 24 April and
the new convertible preference shares to be quoted on ASX by 26 May.
Further Information
Please Contact:
Max Hofmeister
CMI Limited
(07) 3229 0716
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