Severfield-Rowen plots £47.9m rights issue as reveals 2012 loss

SEVERFIELD-ROWEN chairman John Dodds yesterday insisted he had the backing of 60 per cent of shareholders for its heavily discounted £47.9m proposed emergency rights issue.

The structural steel firm – which provided steel for the City’s Shard building and the 2012 Olympic stadium – revealed the rights issue alongside a full-year pre-tax loss of £19.6m, compared to a £10.1m pre-tax profit the year before.

The firm blamed the loss on under pricing on some of its contracts – mainly the City’s Cheesegrater skyscraper – due to be completed next year.

Dodds, who took the helm last month after chief executive Tom Haughey abruptly quit, said the rights issue would put the firm “on to a sound financial footing.”

The fully underwritten seven for three rights issue is priced at 23p – giving the shares a theoretical ex-rights price of 37p – 67.8 per cent beneath their 71.5p closing price on Wednesday. The shares have fallen almost 70 per cent over the past year. Shareholders will vote on the issue on 18 March.