Engineer Cardno Ltd
(ASX:CDD) has announced a $49 million rights issue to fund overseas acquisitions and help boost its balance sheet.
Under the rights issue, the issue price is at $3.25 per share, which is a 19% discount to the Cardno closing price of $4 on Friday.
Proceeds from the rights issue will be used to assist acquiring two major US based environmental consultancy firms, ENTRIX Holding Company and Environmental Resolutions.
The company says both will be earnings per share accretive in FY10 and FY11.
Chairman John Massey says the acquisitions provide further diversity of professional services for Cardno and strengthen the company’s grip on the US market.
On June 21 the company said it expects to post net profit after tax between $34 million and $36 million for the year to June 30, 2010.
Combined with the recently announced acquisitions, the company anticipates a strengthened performance in fiscal 2011.
Cardno reported a net profit of $34.15 million for the year ending 30 June 2009.
