AACo to raise $300m

AAPThe West Australian

Australia's largest beef cattle producer plans to raise almost $300 million through the sale of new shares.

Australian Agricultural Company (AACo) hopes to make about $299 million by issuing new shares and convertible notes.

The cattle breeder will sell more than 219 million extra shares for an offer price of $1, compared to its last traded price of $1.17.

The capital raised will be used to fund existing capital expenditure, reduce debt and free up the company's finances.

Some of the proceeds raised will also go towards the company's $91 million Darwin abattoir, currently under construction.

Civil works were finished in May and full construction should be done by the second half of 2014.

When it is up and running, the abattoir will be able to process around 200,000 cattle per year and provide a direct export route to key Asian markets.

This is part of the company's wider plan to shift away from unreliable domestic markets in favour of more stable global demand.

The abattoir development has been welcomed in the Northern Territory, where it's hoped it will reinvigorate the state's cattle industry which was hit by a 2011 temporary ban on live exports to Indonesia.

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