Decmil has signed a $20 million debt financing agreement and launched a $10 million equity placement to fortify itself as the company anticipates strong revenue from its contracts.
The contractor is expecting more than $500 million in revenue for the 2022 financial year, along with holding $570 million of contracted work in hand.
Decmil’s debt financing includes $15 million from PURE Asset Management and $5 million from Horley.
The $10 million equity raising has been supported by Decmil’s shareholders and comprises 25 million shares at a price of $0.40 per share.
According to Decmil, the funding will be used to grow the company and reduce its reliance on surety bonding facilities and the National Australia Bank overdraft facility which was recently extended to July 2023.
COVID-19 delays have moved several contracts from the 2021 financial year to the 2022 financial year.
Decmil chief executive officer Dickie Dique said the raising would prevent impacts to equity while enabling a healthy balance sheet.
“Crucially, this injection of funds is to drive growth,” Dique said. “The board has decided that pursuing this hybrid financing strategy is the best option available to attract the necessary funds for this proactive initiative, on terms favourable to the company.
“We are delighted with the support of the capital raising with several new Australian and offshore institutional investors introduced to the share register.”
Decmil has also deliver a share purchase plan to raise up to $ 2 million with participation optional. It will provide each shareholder with the ability to apply for up to $30,000 of shares at $0.40 per share.
The funds will also be used to grow the company and reduce its reliance on surety bonding facilities and the National Australia Bank overdraft facility.