Capital raising plan confirmed by WYG
WYG, the Yorkshire design and engineering consultancy, today confirmed plans to raise £30m, describing the move as creating a “significantly stronger position” for the business.
Chairman Mike McTighe said this morning: “Much has been achieved over the past two years to recreate a stable operational platform. Today’s proposals will provide WYG with significant positive cash balances, a strengthened balance sheet and the ability to incentivise its employees, so creating a significantly stronger position from which to take advantage of the growth opportunities that now exist for the group.
“The board is grateful for the support of all of its stakeholders over the past two years, and in particular for the support of its lenders, which has enabled the group to reach this significant milestone in the group’s development.”
WYG revealed plans earlier this month to raise the funds by way of an equity fundraising and it said it had already received support for the proposals from 85% of existing shareholders.
The restructure would convert the group’s net debt, excluding certain restricted cash balances, into convertible shares and redesignate its preference shares into deferred shares. It would also see significant stakes held by a number of banks in the business diluted.
WYG is placing 64m new ordinary shares with new institutional investors and converting approximately £51m of the group’s net debt into 4.54m convertible shares.
Shares in WYG, which plans to launch a share based incentivisation scheme for employees, closed at 8.5p each yesterday.
Law firm Eversheds in Leeds acted for WYG, with its team being led by corporate partner Amanda Partland and banking partner Jason Wurzal.
WYG is now focused on four global market segments: buildings and critical infrastructure, transport, energy and environment and assurance services.
The group made an operating loss before exceptional of £300,000 compared to a profit of £7.7m for the year to June and a loss before tax of £28.6m.
