The share price of resins maker Nuplex has plummeted this morning after the company lifted its trading halt and announced plans to raise $132.8 million through a rights issue.
The shares fell more than 70 per cent from $1.07 in the first 45 minutes of trading but had bounced back
to 40 cents by just after 11am.
Nuplex has been on a trading halt since Monday when it announced plans to raise $110 million to satisfy an agreement with its banks.
The company today said it would raise $132.8 million through a seven for one pro rata rights issue to existing shareholders to be fully underwritten by First NZ Capital.
As reported in the Business Herald the company said it would not be going ahead with a proposed placement initially outlined on Monday.
The new plan will see it issue a staggering 577,643,738 new shares - more than seven times the 82,520,524 it currently has on issue.
The new shares will be issued at 23 cents per share with rights trading set to run on the NZX from April 2 to run until April 15 and on the ASX from March 26 until April 9.
The offer will close on April 20 and the new shares will be issued on April 23.
Nuplex said it also intended to ask the exchanges for approval for First NZ Capital to enter into a call option arrangement which would allow it to offer up to 15 per cent of the shares on issue to habitual and institutional investors who have sub-underwritten the deal, up to five days after April 23.
