The AIM-listed housebuilder said it is aiming to raise up to £9.9mln through a placing and subscription of up to 20.7mln new shares at a price of 47.5p each, an 11% discount to its Wednesday closing price.
Inland Homes said the proceeds will not only strengthen its balance sheet but also allow it to structure payments to its subcontractors and supply chain as well as providing additional liquidity to deal with the current period.
The fundraising announcement was accompanied by a separate trading update in which the company said the pandemic had impacted its interim results for the period ended 31 March, with five significant transactions, three of which to major listed housebuilders, having been aborted last month.
While the impact of the coronavirus on the company’s finances was “clearly uncertain at this stage”, Inland Homes said it was assuming that “all planned sales of our homes are delayed by at least two months and that the majority of our land sales will be delayed by between two and six months”.
These delays meant the company’s revenues, gross and operating profit will be “impacted significantly” and that it had taken a number of measures to converse cash and protect the underlying value of its assets.
The firm has also cancelled its second interim dividend of 2.25p, which it says will save it around £4.6mln.
The shares fell 4.7% to 51p in early trading on Thursday.