Maas Group (ASX:MGH) Commences Equity Raise for Strategic Acquisitions
Equity Raising Strategy
Maas Group Holdings Limited (ASX:MGH) will raise funds through a multi-faceted equity raising initiative, targeting up to $128 million. This will be achieved via an Institutional Placement of up to $100 million and a Conditional Placement of $28 million. Additionally, an underwritten Share Purchase Plan (SPP) will aim to gather $10 million from eligible shareholders in Australia and New Zealand.
Strategic Acquisitions Overview
The equity raise will primarily fund three strategic acquisitions totaling $252 million. These include the acquisition of Cleary Bros, a leading player in construction materials, with a purchase price of $172 million, and stakes in Capital Asphalt Group and a hard-rock quarry in Melbourne. The acquisitions are projected to be EPS accretive on a pro forma basis for FY25.
CEO Comments
Wes Maas, Managing Director and CEO, stated, “This strategic capital raising reinforces our commitment to growth and positioning Maas Group as a robust player in the infrastructure and construction materials sectors.” The acquisitions are expected to enhance the company’s operational capacity and market reach significantly.
Financial Projections and Guidance
Following the placements, Maas Group anticipates a pro forma leverage ratio of approximately 2.6x, which is expected to decline to between 2.0 and 3.0x by June 30, 2025. The company’s FY25 guidance for underlying EBITDA remains in the range of $215 million to $245 million, with expectations that the first half of FY25 will contribute around 40% to this figure.
Funding and Use of Proceeds
The funds will be allocated to partially finance the acquisitions, improve the financial flexibility for further growth initiatives, and cover transaction costs associated with the equity raise. The Offer is priced at $4.65 per share, reflecting a premium of 1.1% to the last traded price. All new shares issued will rank equally with existing shares.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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