QUBE managing director Maurice James has taken heart from investors’ “strong support” for the company’s recent institutional entitlement offer.
According to a statement to the Australian Stock Exchange, the offer raised about $264m at $1.95 a share.
It was said to have been “extremely well supported” by institutional shareholders with take-up of about 99.3% by eligible institutional shareholders.
There was said to have been overwhelming demand from both existing Qube shareholders and new institutional investors.
“We are pleased by the strong support shown by existing investors and other institutional investors for the offer,” Mr James said.
“We see the success of the offer as a clear endorsement of Qube’s long term strategy.
“This entitlement offer provides support to continue the investment in our core businesses, as well as pursue growth opportunities that we expect to arise from the current environment.”
Mr James said new shares issued under the institutional entitlement offer would rank equally with existing shares.
A separate retail entitlement offer, aimed at raising an additional $236m, is to open on Thursday 7 May 2020 and close on Thursday 21 May 2020.
Meanwhile analysts UBS released a mostly statement about Qube’s fortunes, indicating painting a mostly positive picture despite the pandemic.
UBS noted the raising of $500m would bring gearing down to 26% by the end of the 2020 financial year.
“The strategic value of the assets and the exposure to compounding freight volumes over the medium term has not changed as a result of COVID-19,” UBS stated.
“As a result, we upgrade the stock to ‘buy’ on the basis that i) concerns around gearing should reduce through the raising, ii) Qube’s business activities have been deemed essential services and the current demand in containerised logistics will improve over time, and iii) the stock has underperformed the market by 15% YTD providing an attractive entry point.”