By Claire Reilly
SYDNEY, NSW: Thorn Group Limited, parent company of the Radio Rentals and Rentlo chains, has today announced a share purchasing incentive designed to raise $30 million, according to a series of reports released to the Australian Securities Exchange.
The share incentive offers all existing shareholders in Australia and New Zealand 1 new ordinary share for every 8 purchased, at an issue price of $1.85 per share. According to the report, “the issue price represents an 8.9% discount to the adjusted last closing price of Thorn shares on 31 May 2011,” which was $2.03.
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The offer, targeted at raising “approximately $30 million” is designed to reduce debts and to “provide Thorn with the flexibility to actively pursue its strategic initiatives and fund future growth opportunities,” the report reads.
This latest announcement comes off the back of Thorn’s earnings report which was released last week, showing a profit increase of 40%.
John Hughes, Managing Director of Thorn Group, said the share incentive was an opportunity to strengthen the company’s financial standing.
“We remain excited about our future prospects and see a range of growth opportunities available to the business,” said Hughes. “This capital raising and the resulting financial position will enable us to implement any growth initiatives we choose to undertake and provide us with the financial flexibility to pursue acquisitions or other investments as they emerge.”