Serco share price dips as investors back rights issue

 
Emma Haslett
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In March Soames said the company is "on the path to recovery" (Source: Getty)

Some good news for Serco: the troubled outsourcer said this morning its shareholders had largely supported a rights issue, with acceptances for 520m of 549m (that's 95 per cent) of new ordinary shares offered.

The one-for-one rights issue, priced at 101p per new ordinary share, closed on Thursday. This morning, shares dipped 0.2 per cent to 146.4p in early trading.

It's been just over a year since Rupert Soames began the task of turning around the iceberg-bound supertanker that is Serco, which had been hit by a succession of scandals, including one surrounding its tagging of criminals.

In March, it posted full-year revenues of £3.95bn, down from £4.28bn the year before - although Soames took the opportunity to outline his turnaround plan, which included this week's rights issue, but also cut its full-year profit forecast by £20m. On the day, shares plunged as much as 15 per cent. Merrill Lynch and JP Morgan will now find buyers for the remaining five per cent - 25m - of shares.

Is this the beginning of the end of Serco's troubles? In March, Soames said that while 2014 had been an "extremely difficult year" for Serco, things were beginning to look up.

There is a real sense that, having confessed our sins and in taking the punishment, we are now ready to start on the path to recovery.

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