STRATA ADVISES NEWBURY RACECOURSE PLC
Strata advises Newbury Racecourse plc (PLUS: NYR) on £6.4 million fully underwritten rights issue and successful rump placing.
Newbury Racecourse plc (“the Company”), advised by Strata, has successfully completed a £6.4 million rights issue, which was taken up by some 68 per cent. of the Company’s shareholders. Unallocated shares (the “rump”) were fully sold in a book-built process that introduced new investors to the Company at a 25 per cent. premium to the rights issue price, benefitting those existing shareholders who did not participate in the rights issue.
This transaction, the first ever rights issue on PLUS, required a Rule 9 Waiver as the holdings of the main shareholders, due to their joint underwriting obligations, could have exceeded the mandatory offer threshold. In the event, the successful placement of the rump meant that no shareholder held more than 29.9 per cent. of the Company on completion of the rights issue.
The Company owns and manages Newbury Racecourse, a site of some 300 acres approximately one mile from the town centre of Newbury. The proceeds from the rights issue have been used to strengthen the Company’s balance sheet and overall financial position in advance of a major planned redevelopment project. On 27 January 2010, the Western Area Planning Committee of West Berkshire Council resolved to grant outline planning permission for this redevelopment.