Construction and contracting group Decmil has announced an $85 million capital raising to fund the acquisition of a 50 per cent interest in the 2,265-room, $150 million Calliope accommodation village near Gladstone, Queensland.
Decmil said it would raise the funds through a 1 for 3 non-renounceable entitlement offer to existing shareholders, to raise the $85 million required to purchase a 50 per cent stake in the MGA Gladstone Unit Trust, owner of the camp.
Decmil also said today that the Commonwealth Bank of Australia had provided a credit-approved offer of finance for up to $80 million to fund construction of the village.
Subject to demand, the build out to 2,265 rooms is expected to be completed in April 2013, and represents more than $150 million in construction work for Decmil Australia.
Infrastructure consortium Wiggins Island Coal Export Terminal has signed on for 240 rooms in stage 1 and 208 rooms in stage two of the development. WICET has the option to extend for a further two years.
The consortium consists of eight equity participants, including Xstrata Coal, Aquila Resources ans Wesfarmers Curragh.
DGL’s incoming chairman, Giles Everist, said: “there are multiple strategic benefits for DGL arising from this transaction including the immediate and low risk ramp up of Decmil Australia’s Queensland operations into the Queensland regional construction market, particularly the Gladstone region, via ongoing project management and construction work at the Village.”
“Furthermore, this investment creates a recurring revenue stream strengthening future margins for DGL and will generate strong earnings per share accretion in future years.”
