Tuesday, October 8, 2013
Sharp Public Offering To Fall Y30bn Short Of Plans
OSAKA (Nikkei)--Sharp Corp. (6753) will raise a maximum of 136.5 billion yen in an upcoming public offering and private placement of new shares, about 30 billion yen less than initially planned, according to an announcement Monday.
The public offering's initial price of 279 yen per share is 4.12% below the Monday closing price of 291 yen. The restructuring electronics manufacturer had planned to procure a total of up to 166.3 billion yen, issuing shares at 348 yen each.
But Sharp stock tumbled more than 20% between the Sept. 18 offering announcement and Monday on concerns over share price dilution and uncertainty about the firm's growth strategy. The company lowered its estimate for the public offering to a maximum of 119.1 billion yen, 20% short of the initially planned 148.9 billion yen. The shares will be issued Oct. 15.
The amount raised via a private placement with Makita Corp. (6586), Lixil Group Corp. (5938) and Denso Corp. (6902) will remain at the planned total of 17.4 billion yen. Sharp intends to issue additional shares to compensate for the lower issue price. Makita will likely hold a 2.11% interest in the firm -- more than Samsung Electronics Co., which bought a stake in March.
Sharp will book its pension shortfall as a liability at the end of the fiscal year. Although its capital base will increase less than expected from the offerings, the company expects to be able to maintain a certain degree of capital by raising funds and implementing its medium-term business plan.
(The Nikkei, Oct. 8 morning edition)