THE WAVE of companies seeking to raise fresh capital from shareholders showed no sign of abating yesterday as engineer GKN and pub group Marston’s both announced rights issues.<br /><br />GKN aims to raise £423m, while Marston’s is asking the market for £176m. GKN’s 50p offer price represents a 39 per cent discount to Wednesday’s closing price.<br /><br />The aeroplane and car engineer said the cash will reduce its reliance on debt refinancing and allow it to “sidestep more onerous covenants”.<br /><br />It added the cash would also allow it to take advantage of the opportunities for growth that the backdrop in its end markets continues to present.<br /><br />The company – which is shedding nearly 6,000 jobs worldwide as it battles the slowdown in the automotive and aerospace sectors – also announced that sales for the five months to 31 May totalled £1.8bn, a 10 per cent decrease year-on-year.<br /><br />Marston’s plans to offer 298.8m new shares at 59p each, a 40 per cent discount to Wednesday’s closing price. The pub operator, led by chief executive Ralph Findlay, said it will spend £140m of its new capital to accelerate its strategy of acquiring and developing new-build pubs.<br /><br />It will use the remainder to buy pubs from rivals or to repay debt, if it can buy it back at attractive prices.<br /><br />Marston’s is the second pub group this week to launch a cash call, after Punch Taverns on Monday said it planned to raise £375m.<br /><br />But RBS Hoare Govett chief executive Paul Nicholls said that there was no sign that investors were tiring of the weekly fundraising launches.<br /><br />“I think investors are still keen to help companies raise money, but the story accompanying the issue is going to be increasingly important,” he said.<br /><br />Marston’s shares sunk by 16 per cent to close at 118p yesterday, while GKN closed 0.4 per cent down at 119.5p.<br /><br /><strong>UK-LISTED CASH CALLS </strong> TOP 20 BY VALUE June 2008 - June 2009<br /><br /><strong>1 </strong>HSBC<strong> £12.5bn<br /></strong><strong>2 </strong>Royal Bank of Scotland<strong> £12bn<br /></strong><strong>3 </strong>Rio Tinto<strong> £9.5bn<br /></strong><strong>4 </strong>Imperial Tobacco<strong> £4.9bn<br /></strong><strong>5 </strong>Xstrata<strong> £4.2bn<br /></strong><strong>6 </strong>Lloyds Banking Group<strong> £4bn<br />7 </strong>Standard Chartered<strong> £1.8bn<br />8 </strong>Wolseley<strong> £1.05bn<br />9 </strong>Land Securities<strong> £755m<br />10 </strong>British Land<strong> £740m<br />11 </strong>3i Group<strong> £732m<br />12 </strong>Liberty International<strong> £600m<br />13 </strong>Hammerson<strong> £584.2m<br />14 </strong>Segro<strong> £500m<br />15 </strong>GKN<strong> £423m<br />16 </strong>Premier Foods<strong> £404m<br />17 </strong>Punch Taverns<strong> £375m<br />18 </strong>William Hill<strong> £350m<br />19 </strong>DSG International<strong> £310.6m<br />20 </strong>Greene King<strong> £208m<br /><br />SARA HALE<br />MD, HOARE GOVETT<br /></strong>The Marston’s rights issue is fully underwritten by RBS Hoare Govett and JP Morgan Securities.<br /><br />The Hoare Govett team is headed up by its managing director Sara Hale, whose other clients include Whitbread, Rolls-Royce and Cable & Wireless. The firm is a long-standing adviser to Marstons.<br /><br />Durham University educated Hale has been with Hoare Govett for over ten years, prior to which she worked in the Corporate Broking department of HSBC Investment Bank.<br /><br />Hoare Govett are also co-managers and underwriters on the GKN cash call, working closely with JP Morgan on both initiatives. <br /><br />Hoare Govett chief executive Paul Nicholls and director John Fishley are leading this fundraising.<br /><br />Nicholls has over 30 years experience in corporate broking, mainly with James Capel and UBS Warburg, and he joined Hoare Govett three years ago. <br /><br />He is responsible for many of the senior institutional and corporate relationships in RBS Hoare Govett, including Imperial Tobacco, Rolls-Royce, Tate & Lyle and Premier Foods.<br /><br />His relationship with GKN stretches back to his days with Warburg.<br /><br />Recent work includes rights issues for Rio Tinto, Bowleven, Informa and Amlin Insurance.