Eurotunnel raised approximately Euro313M (US$484M) through the rights issue at the end of last month that was oversubscribed.
The rights issue is the final part of its two-step financial restructuring of the formerly struggling Anglo-French transport infrastructure group, which owns the Channel Tunnel and operates shuttle train services between Folkestone and Calais.
Just over 31.3M new shares were privately placed at a value of €10 (US$15.5) per share. The offer was closed the day it opened, not least because of the strong interest of institutional investors. The new shares are to be listed early June.
Jacques Gounon, chief executive, said: ‘Following the success of the public placement, the significant over-subscription of the private placement confirms the keen interest of investors in the new Eurotunnel.’
The cash injection follows an earlier issue of subordinate deferred stock, which raised an aggregate amount of approximately €841M (US$1,300M) and was used to partly settle debt. The new stock issue will also contribute to debt reduction. As a consequence of the lower debt, Eurotunnel will face significantly reduced interest charges over the next couple of years.
Financial structuring and improved traffic flow enabled Eurotunnel recently to report its first, pro-forma profit, which was for 2007. The earnings were slightly in the black for the period, at US$2M (T&TI, April, p13).
The rights issue was managed by a syndicate of banks comprising ABN Amro, HSBC, Lazard-Natixis, Lehman Brothers and UBS Investment Bank.
