- Webjet (WEB) has successfully completed the retail component of a $346 million equity raise announced on April 1
- The travel group set out to launch an institutional placement and entitlement offer to mitigate the impacts of COVID-19
- However, the raise has been a little too well received as Webjet is now forced to refund $14.5 million to eligible shareholders
- The company received nearly $133 million worth of applications but due to top-up facility limits this needs to be scaled back to roughly $118 million
- Webjet is up a slight 0.88 per cent and shares are trading for $2.28 each
Webjet (WEB) has completed, and exceeded, the retail component of its $346 million underwritten one-for-one accelerated non-renounceable entitlement offer.
The retail component represents the second stage of the travel company's A$346 million equity raising announced on Wednesday April 1 2020.
The announcement essentially begged for a way to mitigate the impact the coronavirus has had on the travel industry. Webjet's equity raise included an institutional placement and entitlement offer to raise at least $275 million at an offer price of $1.70 per share.
The following day, Webjet told the market it had completed the institutional component of the offer which raised $231 million. The travel group also told the market it expected the retail component would raise $115 million.
Today the disclosed amount is $118 million - exceeding the company's expectations.
The retail offer was sent to 24,060 eligible security holders and Webjet received 12,633 valid applications for approximately 50.4 million shares leading to approximately A$86 million.
But it seems things went a little too well for Webjet as it received another $46.7 million in eligible applications for its top-up facility.
Scale it back
Unfortunately, the company will need to scale back applications by about 31 per cent for approximately 27.5 million additional shares applied for under the top-up facility.
Roughly $14.5 million is expected to be refunded which Webjet will give directly to the bank account provided by each relevant shareholder for dividend payments. If bank details haven't been given, the refund will be paid by cheque sent by ordinary post to the address recorded on the share register.
New shares under the retail entitlement offer are expected to be allocated on April 28 and commence trading on the ASX the following day.
Webjet is up a slight 0.88 per cent and shares are trading for $2.28 each at 2:15 pm AEST.