The EBOS Group Ltd (ASX: EBO) share price is edging higher today after the company provided an update on its equity raise.
At the time of writing, the pharmaceutical wholesaler and distributor’s shares are swapping hands for $36.17, up 4.24%.
What did EBOS announce?
Investors are buying up the EBOS share price after coming out of a trading halt this morning.
According to the release, EBOS advised that it has successfully completed a fully underwritten placement. The offer received significant interest in which both new and existing investors across Australia and overseas, raising NZ$674 million (A$642 million).
EBOS will issue around 19.5 million ordinary shares under the placement, which represents about 11.9% of its entire issued capital. The issue price of NZ$34.50 per share reflected a 5.5% discount to the last closing price of NZ$36.50.
The newly created shares are expected to settle on Tuesday 14 December, with allotment on the following day.
In addition, EBOS will launch a non-underwritten retail offer to eligible shareholders, raising a further NZ$105 million (A$100 million). Detail of the retail offer will be released in a retail offer booklet on 15 December.
The closing date for application in the offer will be on Monday 17 January.
The proceeds raised from the placement will be used to partly fund the acquisition of LifeHealthcare. EBOS will use a combination of equity, debt and existing capital reserves.
Founded in 2006, LifeHealthcare is one of the largest distributors of third-party medical devices in Australia and New Zealand. The company has a broad portfolio of products in various channels that include spine, orthopaedics, robotics, plastics & reconstructive surgery, and interventional neuro-vascular surgery.
What did management say?
EBOS CEO, John Cullity commented:
We are very encouraged by the strong support from investors for the Placement and in particular, the level of support from our existing shareholders. We are also pleased to have the opportunity to welcome new high-quality investors to the register.
The acquisition of LifeHealthcare accelerates EBOS’ medical devices strategy and creates a platform for EBOS to capitalise on additional future growth opportunities. We look forward to completion and the integration of LifeHealthcare into our existing institutional healthcare division.
About the EBOS share price
Adding to today’s gains, the EBOS share price has accelerated 51% in the past 12 months. It’s worth noting that the company’s shares are hovering about 3% off its all-time high of $37 reached in mid-September.
Based on valuation grounds, EBOS presides a market capitalisation of $5.93 billion, with roughly 164.18 million shares outstanding.
The post Here’s why the EBOS (ASX:EBO) share price is climbing today appeared first on The Motley Fool Australia.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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