Institutional investors have over-subscribed the first stage of the Australia Agricultural Company’s (AACo) public share offer this week. The $219 million accelerated capital raising initiated by AACo has generated approximately $129.2 million from institutional investors from Australia and overseas. Existing shareholders took up 56% of their entitlement however new investors had to have their acceptances rationed. Through the institutional offer Bahamas-based AA Trust has increased its share in AACo to almost 20% – up from 13.5% after making a pre-commitment offer showing support for AACo’s long-term strategy and move in the value chain to include meat processing. The capital raising consists of a $219.2 million entitlement offer and $80 million in convertible notes for a total worth of approximately $300 million. The funds will be used to reduce AACo’s debt and to help pay for the company’s $91 million abattoir project in northern Australia. The institutional offer is to be followed by a retail offer when retail shareholders will have the opportunity to accept seven shares for every ten currently held at a discounted price of $1 each.
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