Australia's Orora falls on discounted capital raise to fund $1.4 bln Saverglass buyout

Orora

06/09/2023 04:38

(Updates with analyst comments)
    ** Orora  ORA.AX  shares fall as much as 15.8% to A$2.770,
biggest intraday pct drop since Aug 15, 2019
    ** Packaging co to acquire French glass bottle maker
Saverglass from Carlyle Group  CG.O  for A$2.16 bln ($1.38 bln)
    ** Co to raise A$1.35 bln at issue price of A$2.70 per share
to fund acquisition
    ** Issue price is 21.3% discount to stock's last closing
price on Aug. 25, taking into account 9 Australian cents per
share final dividend 
    ** Co's shares hit lowest level since Feb 15
    ** Morgan Stanley analysts see deal as fair but also view it
as adding third standalone asset rather than a complement to
existing ops 
        ** "We understand the attraction but question whether a
more complementary opportunity may have been a better fit" -
brokerage
  
    ** About 21.3 mln shares change hands, compared with co's
30-day average trading volume of 2.2 mln shares 
    ** Orora shares up 21.8% YTD, as of last close 
   
   ($1 = 1.5691 Australian dollars)

 (Reporting by John Biju and Echha Jain in Bengaluru)
 ((John.Biju@thomsonreuters.com;))