The Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price has been a positive performer on Tuesday.

In morning trade the banking giant’s shares climbed 1.5% to $18.31. This follows the release of an announcement relating to an asset sale today.

What did ANZ announce?

This morning ANZ announced that it has agreed to sell its New Zealand asset finance business, UDC Finance, for NZ$762 million to Japan’s Shinsei Bank.

This sale follows a strategic review of the UDC Finance business. It is also in line with its strategy to simplify its business.

According to the release, the sale will provide ~A$439 million (~10bps) of Level 2 Group CET1 capital at settlement.

It will also release more than NZ$2 billion of funding provided by ANZ New Zealand, further strengthening its balance sheet position.

ANZ Bank New Zealand’s CEO, Antonia Watson, was pleased with the asset sale and believes it is a significant vote of confidence for the New Zealand economy.

She said: “With a strong outlook for infrastructure and agriculture projects as the New Zealand economy rebuilds post-Covid-19, there is a significant role for UDC Finance to play. As such, it needs an owner that can invest in and grow the business.”

“Shinsei Bank intends to preserve UDC’s operations, retain UDC employees and provide long term capital to maintain and grow customer lending in New Zealand. The sale will also mean UDC Finance will continue to operate as an independent finance company and enhance competition in the asset finance market,” Ms Watson added.

Is the ANZ share price in the buy zone?

The ANZ share price may have charged notably higher over the last couple of weeks, but I don’t think it is too late to invest.

Although it isn’t my top pick in the sector, I think it remains a great option at the current level. Especially given its improving balance sheet and the quicker than expected reopening of the Australian economy.

More reading

• The big oil price recovery and bounce in ASX oil stocks are bringing out the bears
• How to value the big four ASX banks
• How bankable are the big four ASX bank shares in 2020?
• 5 ASX 200 winners and 3 losers from last week
• ASX 200 Weekly Wrap: Surging bank shares push ASX toward 6,000

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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This year there have been a large number of companies announcing capital raisings.

While the majority of these came at the height of the COVID-19 pandemic, they continued in May.

Here are all the capital raisings that occurred on the S&P/ASX 200 Index (ASX: XJO) last month:

Atlas Arteria Group (ASX: ALX)

Amount: $495 million, comprising a fully underwritten $420 million institutional placement and a non-underwritten Share Purchase Plan (SPP) to raise up to $75 million.

Offer price: $6.20 per new share, representing a 7.5% discount to its last close price.

Reason: The proceeds will be used to repay its existing €350 million MIBL Facility.

Blackmores Limited (ASX: BKL)

Amount: $117 million, comprising a fully underwritten $92 million institutional placement and non-underwritten SPP to raise up to ~$25 million.

Offer price: $72.50 per new share, which represents an 8.1% discount to its last close price.

Reason: To accelerate growth in Asia, invest in efficiency program, and position its balance sheet for strength.

Breville Group Ltd (ASX: BRG)

Amount: $104 million, comprising a fully underwritten $94 million institutional placement and a $10 million underwritten SPP.

Offer price: $17.00 per new share, which equates to a 9.1% discount to its last close price.

Reason: To enhance Breville’s financial flexibility to continue to invest in the execution of its growth agenda while maintaining a strong financial position. The former includes entering new markets in FY 2021.

Incitec Pivot Ltd (ASX: IPL)

Amount: $675 million, comprising a $600 million fully underwritten institutional placement and a non-underwritten SPP of up to $75 million.

Offer price: $2.00 per new share, which represents an 8.7% discount to its last closing price.

Reason: To take pre-emptive action to strengthen its balance sheet to increase resilience in the current environment and provide financial flexibility to pursue disciplined organic growth opportunities.

Mesoblast limited (ASX: MSB)

Amount: US$90 million (A$138 million) via a placement to existing and new institutional investors.

Offer price: A$3.20 per new share, which represents a 7% discount to its last close price.

Reason: The proceeds will be used predominantly to scale-up manufacturing of its lead product candidate remestemcel-L. This product is for the treatment of critically ill patients suffering with diseases caused by cytokine release syndromes associated with high mortality, particularly COVID-19 acute respiratory distress syndrome.

National Storage REIT (ASX: NSR)

Amount: $330 million, comprising a fully underwritten $300 million institutional placement and a non-underwritten SPP to raise up to a further $30 million.

Offer price: $1.57 per new share, which represents a 7.1% discount to its last close price.

Reason: To strengthen its balance sheet, replenish investment capacity, and provide additional funding flexibility.

Newcrest Mining Limited (ASX: NCM)

Amount: $1.1 billion, comprising a $1 billion fully underwritten institutional placement and a $100 million SPP.

Offer price: $25.60 per new share, representing a 7% discount to its last closing price.

Reason: To purchase the Fruta del Norte Financing Facilities and to fund future growth options such as the construction of declines at Havieron and Red Chris.

Qube Holdings Ltd (ASX: QUB)

Amount: $500 million via a fully underwritten 1 for 6.35 accelerated non-renounceable entitlement offer.

Offer price: $1.95 per new share, representing an 11.8% discount to its last close price.

Reason: To leave the company conservatively geared, with significant balance sheet flexibility and liquidity to continue to pursue its robust growth agenda.

United Malt Group Ltd (ASX: UMG)

Amount: $165 million, comprising a fully underwritten $140 million institutional placement and a non-underwritten $25 million SPP.

Offer price: $3.80 per new share, representing an 11.4% discount to its last close price.

Reason: Taking pre-emptive action to strengthen the balance sheet to increase resilience in the current environment and provide financial and operational flexibility to continue disciplined investment.

More reading

• 3 ASX 200 resources shares to buy today
• 5 things to watch on the ASX 200 on Tuesday
• Forget cheap stocks. Why investors should watch ASX gold shares instead
• ASX 200 Weekly Wrap: Surging bank shares push ASX toward 6,000
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here are all the ASX 200 companies that announced capital raisings in May appeared first on Motley Fool Australia.

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The ASX energy sector is on a tear since the oil price bounced from its unprecedented meltdown, but the bears might be ready to pounce again.

In case you forgot, the WTI crude benchmark crashed into negative territory for the first time in history on April 20 before rebounding to US$35 a barrel while the Brent nearly doubled since bottoming to US$38 a barrel.

The turnaround sent the Oil Search Limited (ASX: OSH) share price jumping 27% and the Santos Ltd (ASX: STO) share price climbing 25% over the period.

These stocks are more leveraged to the oil price and explains why the Woodside Petroleum Limited (ASX: WPL) share price is trailing with “only” a 9% gain. But that’s still miles ahead of than the 5% increase in the S&P/ASX 200 Index (Index:^AXJO).

More production cuts to support market

However, the party for our energy producers may not last. Experts are casting doubt on the sustainability of the oil price rally even as OPEC and Russia (OPEC+) moved forward their meeting by a week to this Thursday.

There’s speculation that the oil producing bloc will extend the supply cuts that triggered the recovery and moved their next meeting forward to speed things along.

But Australia and New Zealand Banking GrpLtd’s (ASX: ANZ) commodities strategist Daniel Hynes told the Australian Financial Review that this could be a bearish sign instead.

Oil party pooper

OPEC+’s eagerness to bring forward their meeting and keep production quotas in place signify that demand for crude isn’t recovering at the same pace as prices.

Demand for oil plummeted due to the COVID-19 shutdown of the global economy. While the gradual reopening of some countries is lifting demand for fuel, the recovery is patchy, especially as air travel remains off the cards.

The widespread racial riots in the US sparked by the death of George Floyd is also hurting demand for the commodity.

US drivers in a jam

The US summer driving holiday season looks over before it began with Hynes saying that demand was down 25% to 30% over the Memorial Day holiday on May 25, which usually kicks off the season.

“The US driver consumes about 10% of the world’s oil. So, it’s an important sector,” he told the AFR. “Any data highlighting how it’s going will be focused on.”

Foolish takeaway

While oil market looks prone to a pullback, or even a correction, its unlikely that we will see oil turn negative again.

As I wrote back then, that was probably the only occasion time in our lifetime that we will witness such an event.

This means the worst for the market is likely behind us, although the volatility means investors will need to reasonably strong stomach if they wanted to invest in ASX oil-exposed stocks.

More reading

• 2 ASX 200 shares to watch on Tuesday
• How to value the big four ASX banks
• Where to invest $5,000 into ASX 200 shares immediately
• 3 ASX 200 resources shares to buy today
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Brendon Lau owns shares of Australia & New Zealand Banking Group Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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