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Dorchester Pacific raises $10.3m through entitlement offer

Fuseworks Media
Fuseworks Media

Wellington, Aug 24 NZPA - Finance company Dorchester Pacific says it raised $10.3 million through an entitlement offer, meaning all necessary conditions of its capital reconstruction plan can now be met.

Under the reconstruction plan, securities will be issued to debenture holders in return for their outstanding debenture stock.

Subscriptions for the entitlement offer were received from 944 shareholders and debenture holders, with the amount raised including $460,000 from noteholders who chose to receive Dorchester shares rather than a cash settlement for their notes, Dorchester said.

The capital raising was underwritten by $7m by the company's major shareholders, The Business Bakery and Hugh Green Investments.

Dorchester executive director Paul Byrnes said the number of subscribers for the entitlement offer reflected the support the company had received from investors and shareholders during what had been a difficult two years.

The new capital would be used to help the growth of Dorchester's consumer and motor vehicle lending book and would support an increased marketing investment in the savings and insurance business in order to increase revenue and profits and provide shareholder value.

New shares would be issued at 10c each, and for every new share subscribed to under the capital raising, Dorchester would issue one option to subscribe for a new share in three years at 12.5c per share.

Dorchester chairman-elect Grant Baker said that as the economic environment in New Zealand started to recover, there would be good opportunities for companies such as Dorchester that were in a financial position to invest and that could move quickly.

Dorchester shares last traded at 10c.

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