EOH Holdings CEO Stephen van Coller has described the successful conclusion of the IT services group’s rights issue as a “watershed moment” that closes a “long and difficult chapter”.
The rights offer, which was oversubscribed by a large margin, raised R500-million, plus another R100-million from empowerment partner Lebashe Investment Group, which subscribed for a specific issue of shares.
“Proceeds from the capital raise will be used to settle the majority of EOH’s bridge facility. This will allow for a debt restructuring at lower interest rates and provide the company with the ability to make significant investments in the growth of the business,” the JSE-listed firm said in a statement on Monday.
Read: EOH outlines terms of crucial rights offer
“We are hugely encouraged that, in this difficult environment, our rights issue has been oversubscribed. This incredible vote of confidence from our shareholders in the EOH of tomorrow, and the significant strategic progress the board and management have made, is proof that EOH is investable again,” said Van Coller in the statement.
Watch: Stephen van Coller on what’s really happening at EOH
“More than 91% of shareholders followed their rights, with requests for additional allocations of R220-million. This, along with the R350-million underwriting commitments, means a total demand of over 200% for the offer,” he said.
“This incredibly successful rights issue in a very tough economic climate welcomes a new era for EOH, with our now optimised capital structure giving us the ability to invest in our growth, knowing that our strategy for EOH 2.0 has the wholehearted backing of all our shareholders and lenders.” – © 2023 NewsCentral Media