The strong institutional response to Transurban’s capital raising to part fund the development of Melbourne’s West Gate Tunnel comes as no surprise. I have written twice about Transurban over the last few months. Back on 14 August with “Transurban should be a core stock in your portfolio” and then on 16 October with “Sick of paying tolls…….why not own the toll road”.
In the capital raising, 94% of entitlements available to institutional holders were taken up at the offer price of $11.40, raising approximately $1.35 billion. Those not taken up were auctioned and achieved a clearing price of $12.50 per security, a premium of $1.10 to the offer price. Retail security holders will now have their chance to participate.
On Friday, Transurban’s securities closed at $12.80. The renounceable entitlements (which are not eligible for the December distribution payment of $0.28) closed at $1.12.