Major shareholders of Wynyard Group will effectively get a further 4 per cent discount by way of a fee payable in shares for committing to the crime-fighting and security software developer's deeply discounted $30 million rights offer.
The arrangement required a waiver from NZX listing rules because Skipton Investments, deemed a related party with a 17.78 per cent holding, has indicated it will participate in the placement and formalise its participation with a commitment letter.
Wynyard's capital raising is by way of a one-for-four renounceable rights offer at 85 cents a share, well below the minimum $2 that shareholders approved in December. The company needs extra funds to meet its working capital requirements by the end of March, having raised $42.6 million in 2015, when its net cash outflow was $32.7 million.
With the commitment fee of 4 per cent of the dollar amount committed, the price would effectively be 81.6 cents. The stock rose 4 per cent to $1.01 today and has dropped 47 per cent this year.
Wynyard said the fee was initially negotiated by an institutional shareholder unrelated to Skipton and presented to the company by First NZ Capital, the arranger of the offer, along with a similar proposal for those that agreed to take up any shortfall. Wynyard subsequently decided to offer the fee to all major and institutional investors.
Skipton hasn't made a commitment to any shortfall.
Last month the company said its annual loss doubled to $44.1 million in 2015 on little changed revenue of $26.3 million. Total operating costs for the year were $57 million of which around 60 per cent were people-related.
Wynyard expects 2016 revenue in the middle of analysts' current forecast range of $54 million to $65 million, plus the licence revenue from the latest deal.