Costain Group PLC (LON:COST) said it is to raise £100mln through an equity raise backed by UAE-based construction group ASGC.
The fundraise will comprise an £80mln firm placing and an additional £20mln through an open offer and placing, both of which will be priced at 60p per share compared to last night’s closing price of 75p.
ASGC has committed to invest £25mn in the funding round, with Costain intending to use the £100mln to bolster its balance sheet and take advantage of the distress of competitors by highlighting its financial strength when bidding for contracts.
Costain added its lenders have also agreed to extend its bank facilities until September 2023.
The contractor has been awarded a number of high-profile contracts recently. Last week, it was appointed to the £4.5bn Smart Motorway Alliance, while its joint venture Skanska Costain Strabag, picked up a £3.3bn contract to design and build the tunnels running into Euston in London for the HS2 project.