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Coffey International plots $40m raising

Coffey International plots $40m raising

Consulting services company Coffey International (ASX:COF) has launched a $40 million capital raising to help repay debt.

The fully underwritten rights issue will consist of a $10.9 million placement and a $29.1 million entitlement offer.

Announcing the capital raising, Coffey said debt would be reduced to 1.9 times FY12 ebitda from 2.7 times, on a pro-forma basis. Gearing will also be cut to 34.5%, from 49.7%.

A focus on deleveraging is a key component of an operational streamlining project, first announced in June.

Coffey International is in the final stages of refocusing around its three main businesses – geosciences, international development and project management.

Options including full or partial divestments are being explored for other operations including rail and commercial advisory businesses.

Coffey International is projecting an FY12 underlying ebitda of at least $45 million as a result of the streamlining efforts. The firm reported an ebitda loss of $39.7 million in FY11, but this included $72 million in impairment charges and non-recurring restructuring costs.

Net debt was $121.2 million as of the end of FY11.

COF shares stayed flat on Wednesday at $0.460.

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Tags debtrights issuecapital raisingASX:COFCoffey Internationaldelveraging

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