Royal Imtech NV, the Dutch company seeking to raise 500 million euros ($656 million) in a rights offer, dropped the most in a month after saying it also plans to sell preference shares to further strengthen its finances.
Imtech fell as much as 11 percent to 2.02 euros in Amsterdam trading, the steepest intraday drop since June 20. The Gouda, Netherlands-based company plans to raise 30 million euros by selling cumulative financing preference shares to ING Groep NV and Rabobank Group, it said today.
Imtech, which started a fully underwritten 4-for-1 rights offer earlier this month, is cutting jobs at its Benelux region, Marine, German and Eastern European units as it seeks to improve its competitiveness and bring its business capacity in line with market conditions. Operating performance for the divisions has continued to be poor in June, the technical-services provider said today.
“The company keeps on coming with disappointing news,” Edwin de Jong, an Amsterdam-based analyst at SNS Securities, said in a note to investors. “And with no clear direction of where margins should be in Imtech’s activities we find it very hard to have a solid investment opinion.”
Imtech traded 10 percent lower at 2.06 euros as of 11:22 a.m. local time in Amsterdam. That valued the company at 926 million euros.
Imtech, which offered to sell 357 million shares at 1.40 euros apiece, said the rights issue will be extended by five business days “to provide investors with the opportunity to incorporate the information” announced today. Trading of the rights had been scheduled to end later at 3 p.m. local time.
The preferences shares may be convertible into ordinary stock and have a dividend yield of about 4.48 percent a year, the Dutch provider of 2012 London Olympics stadium infrastructure, said.
Cost levels at the German and Eastern European units remain too high, resulting in a significant loss in the second quarter, Imtech also said. Performance in the Benelux region is affected by volume and price pressure in the commercial real estate and infrastructure markets, it said.