(Adds details, background)
March 28 British aerospace and defence
electronics company Cobham, which is being investigated
by the country's Financial Conduct Authority, said on Tuesday it
would raise 512.4 million pounds ($642.6 million) in its latest
The 2-for-5 issue of 683.1 million shares was priced at 75
pence per share, a 40.9 percent discount to Monday's closing
share price of 126.8 pence.
The company launched the emergency rights issue earlier this
month, to shore up its balance sheet after a "deeply
disappointing" operating performance in 2016.
"This rights issue will significantly strengthen Cobham's
balance sheet and, together with other actions, will provide us
with a sustainable platform for the future," Chief Executive
David Lockwood said in a statement.
He said it was the first step in reducing the group's net
debt leverage ratio towards the group's target of 1.5 times
earnings before interest, tax, depreciation and amortisation,
"both reassuring our customers and giving us the flexibility to
drive operational improvements."
On Monday Cobham said it was being investigated by the UK's
Financial Conduct Authority in connection with its handling of
inside information ahead of a trading update and announcement of
an earlier rights issue in April last year.
Merrill Lynch International and J.P. Morgan Securities plc
are acting joint bookrunners and joint underwriters for the
rights issue, which is expected to be completed in the second
quarter, while Barclays Bank PLC is acting as co-bookrunner and
(Reporting by Arathy S Nair in Bengaluru; Editing by Mark
Potter, Greg Mahlich)