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MarketScreener Homepage  >  Equities  >  Tokyo  >  Honda Motor Co., Ltd.    7267   JP3854600008


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Sweden's Veoneer to sell $500 million of bonds, equity to boost working capital

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05/21/2019 | 04:29am EDT
Jan Carlson, CEO of Veoneer, Inc., watches as his company's stock begins trading on the floor

(Reuters) - Swedish auto tech company Veoneer plans to shore up its working capital by $500 million (394 million pounds) through the sale of bonds and shares, as it waits for a strong order book to translate into a pick up in earnings.

A weak car market and high research, development and engineering costs have led to slower sales and larger-than-expected losses for the maker of radars, vision systems and advanced driver assistance and autonomous drive software.

In spite of a $19 billion order book, the auto industry's long lead-times before sales are completed have forced the company to raise fresh capital.

Veoneer, which competes with the likes of Aptiv, Continental and Bosch, said in April it would seek up to $500 million to help it cope with a downturn in the vehicle market and fund new product development, but did not give further details.

The company, which supplies Daimler, Volkswagen, Ford and Honda among others, will offer $350 million worth of common shares and $150 million of convertible senior notes maturing in 2024, it said in a statement late on Monday.

"Veoneer intends to use the net proceeds from the common stock offering and concurrent convertible notes offering for working capital and other general corporate purposes," it said.

Veoneer's shares fell in early trade in Sweden on Tuesday but were trading 8.9 percent higher by 0744 GMT.

"This has been somewhat of a wet blanket, and with details now out I don't think it's that strange that shares are rising," Handelsbanken Capital Markets analyst Hampus Engellau said.

"Perhaps their transparency around the order book, standing at $19 billion, is starting to sink in."

The company's shares, listed in Stockholm and New York, had fallen by around a third over the past month, giving a current market capitalisation of around $1.65 billion.

The stock fell 16 percent on April 29 alone after Veoneer announced its intent to raise fresh capital, reported quarterly earnings below market forecasts and said it would review its financial targets.

Morgan Stanley will be the lead book-runner for the equity and bond issue, while Nordea and SEB will be joint bookrunners, Veoneer said.

(Reporting by Johannes Hellstrom in Stockholm and Sathvik N in Bengaluru; Editing by Bill Berkrot and Kirsten Donovan)

By Johannes Hellstrom

Stocks mentioned in the article
ChangeLast1st jan.
APTIV -0.09% 88.96 Delayed Quote.44.49%
DAIMLER AG 1.94% 49.375 Delayed Quote.5.48%
FORD MOTOR COMPANY 1.98% 9.29 Delayed Quote.21.44%
HONDA MOTOR CO., LTD. -0.03% 2908.5 End-of-day quote.3.88%
ONE STOP SYSTEMS, INC. -2.30% 2.55 Delayed Quote.31.44%
VEONEER, INC. 1.10% 16.57 Delayed Quote.-29.70%
VOLKSWAGEN AG 1.28% 171.52 Delayed Quote.21.90%
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Financials (JPY)
Sales 2020 15 439 B
EBIT 2020 753 B
Net income 2020 646 B
Debt 2020 4 944 B
Yield 2020 3,90%
P/E ratio 2020 7,92x
P/E ratio 2021 7,28x
EV / Sales2020 0,65x
EV / Sales2021 0,63x
Capitalization 5 096 B
Technical analysis trends HONDA MOTOR CO., LTD.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 21
Average target price 3 290,56  JPY
Last Close Price 2 908,50  JPY
Spread / Highest target 42,0%
Spread / Average Target 13,1%
Spread / Lowest Target -7,17%
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