Lacklustre debut for Worley on ASX

Engineering services outfit Worley Group made a somewhat lacklustre debut on the Australian Stock Exchange last week, slipping below its issue price on thin volume.

The shares debuted steady with their $1.75 issue price, but slowly sank to close at $1.70. On Friday, the stock was trading at about $1.74.

Earlier in the week, the Worley Group announced that it had raised $83.7 million in its initial public offer by selling 32% of the company.

The offer, managed by investment bank UBS Warburg, initially sought to raise up to $96 million by selling 48 million shares for between $1.75 and $2 each. Of those, 38.5 million were sold into the float by existing shareholders.

With a share price of $1.75, this means of the $83.7 million raised, only about $16 million will find its way to Worley. According to the prospectus, the float is expected to cost about $6.8 million.

Worley chief financial officer David Housego said the company was however happy it had secured the backing of 20 domestic and six offshore institutional investors. "We are happy with where we've got," Mr Housego said. "This wasn't about a heavy need for capital at this stage.

"It enables us to go back and tap the market as opportunities arise."