Australian Investment Blog
ASX:TCL 05/09/2018
Transurban (TCL) resumes trading post capital raise
Stock
Transurban (ASX:TCL) $11.64 as at 5/09/2018
Event
Transurban recommenced trading today following the $4.2bil equity raise helping fund the successful $9.3bil WestConnex bid. The toll road operator saw strong demand for the raise from institutional investors, which was done at $10.80, around a 10% discount to the last traded price before the stock went ex-rights – retail shareholders have until the 18th of September to take up the new shares. We spoke about the likelihood of a capital raise from Transurban back at their result in early August, and our view has come true. It’s a big raise for a big acquisition, but it does put Transurban well clear at the top of the food chain for toll roads in Australia however the length of time it took the ACCC to rule on the deal highlights the increasing headwinds to Transurban’s Australian growth pipeline. Although the WestConnex asset will likely see other linked toll roads go to Transurban, it will limit the ability for the company to pick off other roads in the country and a push for any significant growth will have to be offshore.
Transurban (ASX:TCL) Chart
Market Matters Take/Outlook
Our view remains negative infrastructure stocks as rising bond yields make them less attractive.
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