29.07.2014

Sevcon rights issue

Motor controller manufacturer Sevcon is planning to raise $10 million in a new rights issue open to all shareholders.

The issue will be for preferred stock with a four percent annual dividend and will be convertible at any time at the holder's option into shares of Sevcon's common stock at an initial conversion price of $8.00 per share, representing a conversion ratio of three shares of common stock for each share of preferred stock. Sevcon will also be able to require conversion at any time after five years, if the closing sale price of the common stock has exceeds $15.50 for 20 out of 30 consecutive trading days.

The company says that proceeds will be used for general corporate purposes and growth, including funding ongoing research and development and product commercialisation initiatives and acquisitions of other businesses.