On May 29th, Nordic Camping & Resort announced that it has decided to issue a maximum of 1 000 000 shares without preferential rights for existing shareholders. The company has currently 8 478 756 shares outstanding. The total offer will not exceed EUR 2.5m.
According to management, the reason for the share issue is to increase the shareholder base and to receive additional capital in order to finance future growth via investments in existing and new camping grounds. An increased shareholder base is seen as a way to improve liquidity in the share and as a preparation for a future listing on Nasdaq’s Firth North list.
The price for the new shares will be determined by the volume weighted average during the subscription period with a discount of 7%, with the minimum level being SEK 22. The subscription period runs between May 29th and June 8th. This means that interested investors have until today to participate in the offering. For more information please have a look on Nordic Camping’s homepage (www.nordiccamping.se).
Obviously, a dilution of up to 12% is seldom welcomed. We also would have preferred to see such an announcement in direct connection with a new acquisition and/or a concrete investment scheme for existing camping grounds. As an example, the recently acquired Halmstad camping ground has the potential to double in size, as well as the building permit for 45 cottages. At the minimum share price of SEK 22, the emission would add up to SEK 22m in cash to Nordic Camping’s balance sheet. At the end of Q1 2015, the company had a net debt position of just below SEK 44m (net debt / equity ratio of 70%).
Nordic Camping as a strong track record of acquiring and successfully integrating new facilities and we believe that management will use the proceeds of the share issue wisely.