The Ausdrill Ltd (ASX:ASL) share price has jumped 17 per cent higher in late Friday morning trade after the mining services company successfully completed its institutional entitlement offer.
The offer raised $175 million at a share price of $1.47, with Ausdrill expecting to raise $250 million in total.
The funds are to be used primarily for the acquisition of Barminco, one of Australia’s leading underground hard-rock mining contractors. Ausdrill are paying around $270 million to acquire the equity in Barminco. The transaction would broaden Ausdrill’s strategic footprint to be Australia’s clear number two mining services company.
In what could be a case of perfect timing, in its July monthly update, the Perennial Value Australian Shares Trust said it had established a position in Ausdrill.
In late morning trade on Friday, the Ausdrill share price has jumped 29 cents or 17 per cent higher to $2.00.
Earlier this week, Ausdrill reported FY18 profits had jumped 96 per cent higher to $61.1 million. The company declared a full year dividend of 7 cents per share, an increase of 75 per cent.
With Ausdrill shares price now at $2.00, the company trades on a trailing dividend yield of 3.5 per cent.