JOHANNESBURG - The share price of Omnia Holdings slid 6percent despite it announcing it had raised R2 billion via a rights offer, which would be used to repay its debt.
The share price dipped to a low of R25.07 at 11.45am yesterday. The heavily indebted JSE-listed diversified chemicals group said it had completed the rights offer of 100million new ordinary Omnia shares at a subscription price of R20 per rights offer share.
The rights offer was fully underwritten by a number of asset management companies whose clients were shareholders of Omnia, including Allan Gray, Coronation, Foord, Kagiso, Old Mutual and Prudential.
Omnia in June secured a R6.8bn bridge-loan, while net interest-bearing borrowings was at R4.4bn at the end of March. Debt ballooned after the the group last year acquired international bio-pesticide, nutrients and soil conditioner manufacturer Oro Agri for $100million (R1.49bn). In addition, R695m was spent to construct a new nitro-phosphate plant.
The company said that the remainder of the bridge debt facility not settled via the rights offer proceeds, and which was secured through Omnia’s main debt lenders, was expected to be refinanced into a debt package.
Seelan Gobalsamy, the chief executive of Omnia, said: “We have reached a major milestone on our way to implement the turnaround plan by stabilising Omnia’s financial position. We will now continue to focus on addressing the businesses’ performance and lead Omnia on its next growth phase.”