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CBL seeks $63m to fund expansion

NZN 28/09/2016 Paul McBeth

CBL Corp, which sells credit surety and financial risk insurance, plans to raise up to $63 million in a share placement to institutional investors and a share purchase plan, giving it more headroom to pursue growth opportunities.

The Auckland-based company will raise $60m in an underwritten placement to institutional investors at $3.45 a share and raise up to a further $3min a share purchase plan to eligible investors at the same price, it said in a statement.

The price is an 8.2 per cent discount to Wednesday's closing price of $3.76,

The funds raised will reduce CBL's pro forma debt to $102m from $162m, which the insurer says will give it enough room to pursue new opportunities. Those include accelerating existing business lines into new markets, such as selling surety bonds into Spain and Italy, and chasing new acquisitions, with the company in talks to buy a licensed shell insurance company in the US for $US6.3m.

Trading in the stock has been halted pending the placement and is expected to resume on Friday.

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