Galliford Try confirms £158m right issue

The 1-for-3 rights issue will see 27.7m new ordinary shares will be issued at an issue price of 568p, fully underwritten by HSBC, Peel Hunt and Barclays Bank.

In February, Galliford said it hoped to raise £150m from the share issue.

On Tuesday, chief executive Peter Truscott said: "Following the Group's strong financial and operational performance in the first half, with revenue growth across all three of our businesses and excellent progress against our 2021 strategy, we are pleased today to announce the terms of the group's fully underwritten rights issue."

With "excellent opportunities and demand" for both its private and affordable homes businesses and a strong outlook for the construction business amid government plans for investment in UK infrastructure, he added: "The rights issue proceeds will strengthen the group's balance sheet and ensure that the group's businesses are in a position, with the appropriate capital, to deliver on their respective growth opportunities in line with the group's stated 2021 strategy."

The FTSE 250 company has £550m of debt facilities, comprising a £450m revolving credit facility that matures in 2022, of which £100m was drawn as at 31 December 2017, and £100m of private placement notes due 2027.

Management are targeting a ratio of net debt to net assets of no greater than 30% at the financial year end.

The defined benefit pension scheme had assets at 31 December 2017 of £248.0m and the present value of obligations at £250.7m resulted in a balance sheet liability of £2.7m as at that date.