IWG PLC (LON:IWG) has raised £320mln in a share placing announced late on Wednesday.
The office spaces provider placed 133mln shares at 239p each, an 8% discount to Wednesday’s closing price. They represent 15.4% of the entire issued capital.
READ: IWG suspends share buyback programme and puts the dividend on hold
IWG is looking to use the proceeds to adjust its spaces to social distancing demand and take advantage of merger and acquisition opportunities emerging from the crisis.
The firm expects a significant hit on revenue in the second quarter due to global lockdowns and the lower levels of new sales activity during March and April.
The recovery in the second half of the year will depend on how restrictions are lifted and new sales activity.
In a separate update late on Wednesday, IWG posted a 1%dip in revenue for April to £214mln while net debt shrank to £320mln from £521mln a year ago.
So far, cost-cutting measures such as withdrawing the dividend and reducing salalaries saved £150mln.
Price target goes up
Peel Hunt raised the target price to 239p from 200p, aligning to the placing, which analysts defined “part protective and part aggressive”.
The broker, which expects the second quarter to see a 16% revenue drop, revised the full-year profit forecast to £5mln from £0.
Shares advanced 8% to 280p on Thursday at the opening bell.