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Anonymous ID: 73e763 Oct. 26, 2020, 7:33 a.m. No.11287245   🗄️.is đź”—kun   >>7361 >>7582 >>7584 >>7675

Rolls-Royce seeks $2.6 billion in make-or-break share issue

 

Aero-engine maker Rolls-Royce will ask shareholders on Tuesday for 2 billion pounds ($2.6 billion) in a make-or-break attempt to survive the COVID-19 pandemic, which has stopped planes flying and hammered its finances.

 

At stake is the future of a company which has been at the heart of manufacturing in Britain for more than 100 years, making engines that powered World War Two bombers and still drive the country’s fighter jets and nuclear submarines.

 

Investors are expected to back the rights issue, supporting CEO Warren East’s plan to cut 9,000 jobs and close factories to adjust to a lower level of demand from airline customers that fly with Rolls engines on Boeing 787s and Airbus 350s. Investors can buy 10 new shares for every three they own at 32 pence each, a 41% discount to the theoretical ex-rights price. The company, which made a 5.4 billion pound loss in the first half of 2020, faces a cash crunch at the end of next year, when 3.2 billion pounds of debt needs to be repaid.

 

In a sign of Rolls’s strategic importance, the UK government has guaranteed a 1 billion pound loan on top of the 2 billion pounds it backed in July through its UK Export Finance arm. Rolls accounts for 2% of all UK goods exported and is one of the country’s biggest spenders on research and development. It also buys from 2,300 smaller UK suppliers, and before the pandemic supported as many as 135,000 UK jobs. But COVID-19 has shattered the company’s finances because airlines only pay it when their planes fly, forcing it to seek a 5 billion pound debt and equity package to survive many more months of expected turmoil. Rolls's market value has slumped from over 20 billion pounds in 2018 to 4.7 billion pounds, putting it broadly on a par with online clothing retailer ASOS ASOS.L.

 

Analysts are positive on Rolls’s future if it secures the 50% plus one of votes cast at Tuesday’s virtual meeting. “They’ve given themselves enough time and space to make sure that they get through to the other side,” said Agency Partner analyst Nick Cunningham. Further debt options will also open up if shareholders back the fundraising, including 2 billion pounds from bonds, after strong investor demand enabled it to double the amount it had been aiming for. While the rights issue will be highly dilutive for shareholders, investor advisory groups say it is preferable to a stake sale to a sovereign wealth fund, which would not have given them the option to participate.

 

But ongoing travel restrictions mean the outlook is bleak. There were just three orders for the wide-body jets that Rolls supplies in the third quarter, according to UK industry body ADS.

https://www.reuters.com/article/health-coronavirus-rolls-royce-hldg/rolls-royce-seeks-2-6-bln-in-make-or-break-share-issue-idUSL8N2HH28U

Anonymous ID: 73e763 Oct. 26, 2020, 7:53 a.m. No.11287446   🗄️.is đź”—kun

Jack Ma's Ant Group set for record $34bn stock market listing

 

Ant, backed by Jack Ma, billionaire founder of e-commerce platform Alibaba, is to sell shares worth about $34.4bn (ÂŁ26.5bn) on the Shanghai and Hong Kong stock markets. Advisers to Ant set the share price on Monday amid reports of very strong demand from major investors. The previous largest debut was Saudi Aramco's $29.4bn float last December.

 

Ant, an online payments business, is only selling about 11% of its shares. But the pricing values the whole business at about $313bn. Mr Ma's Ant shares are reportedly worth about $17bn, taking his net worth to close to $80bn and confirming him as China's richest man. Ant runs Alipay, the dominant online payment system in China, where cash, cheques and credit cards have long been eclipsed by e-payment devices and apps.

 

The company is expected to make its dual listing in Shanghai and Hong Kong next week, underling the latter exchange's growing importance as a financing hub. The Trump administration has threatened to limit Chinese firms' access to US capital markets, a move that is part of the long-running trade row between Washington and Beijing.

 

Chinese tech firms, including NetEase and JD.Com, have already raised billions by selling their shares through the Hong Kong stock market.

 

https://www.bbc.com/news/business-54692537