Insights

Why is the Seven Group (ASX:SVW) share price frozen?

The Seven Group Holdings Ltd (ASX: SVW) share price is frozen after news the company is asking for $500 million via a capital raising.
The post Why is the Seven Group (ASX:SVW) share price frozen? appeared first on The Motley Fool Australia. –

man intently watching tv representing media asx share price on watch

Seven Group Holdings Ltd (ASX: SVW) shares entered into a trading halt today after the company announced a $500 million capital raising. At Friday’s close, the Seven share price was changing hands at $23.43.

The company has advised its shares are expected to remain in a trading halt until Wednesday 21 April or until an announcement regarding the capital raise.  

Why the Seven Group share price will be one to watch 

The Seven share price will be in focus when it resumes trading. This comes following the group’s announcement it is pursuing a $500 million capital raising via an institutional placement and share purchase plan. The reasons provided by Seven for the capital raising are to allow for greater balance sheet flexibility and reduce the company’s net debt position to support portfolio growth opportunities across key verticals.  

Seven will be using proceeds of the cap raise to reduce overall debt from $2.6 billion to $2.1 billion, facilitating the retirement of more costly facilities that bear interest rates of 5.60%. 

The new shares will be issued at $22.50 per share, a 4.0% discount to its closing price of $23.43 on 16 April. 

It will be interesting to see whether or not the small discount will affect the Seven Group share price when it resumes trading on Wednesday. 

Seven Group overview

Investors often immediately think of Chanel Seven or Seven West Media Ltd (ASX: SWM) when thinking about Seven Group shares. Seven Group owns 40% of Seven West Media, alongside a number of businesses in the industrial and energy sectors. 

The company owns 100% of WestTrac, a leading Caterpillar dealer which supports Australia’s rich iron ore and thermal coal regions. WestTrac’s key customers include ASX iron ore majors BHP Group Ltd (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG) and Rio Tinto Limited (ASX: RIO). WestTrac delivered an 8% increase in 1H21 revenues to $1,847 million, contributing a significant 78% of the group’s total revenues. 

Seven Group also owns 100% of Coats Hire, the largest nationwide industrial and general equipment hire company. Social distancing and prolonged lockdowns in Victoria impacted construction activity across the east coast, largely driving a 6% decline in 1H21 revenues to $469 million. 

Seven maintains a 23% shareholding of Boral Limited (ASX: BLD), an international building products and construction materials company. Boral recently received an overweight rating from Morgan Stanley after the company completed the sale of its joint venture business for US$1.05 billion. Seven believes there is a strong five-year infrastructure investment growth outlook, with Boral poised to capture demand. 

What also makes Seven an interesting conglomerate is its 28.5% ownership of Beach Energy Ltd (ASX: BPT). Lower oil prices saw Beach Energy’s revenue fall 22% in the first half. Seven has highlighted that OPEC+ supply uncertainty will continue to subdue oil prices as demand recovery ramps up. 

The Seven Group share price has had a flat year-to-date performance but has more than doubled since its March 2020 lows. Its shares are currently not too far off their February all-time record highs of $24.25. 

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why is the Seven Group (ASX:SVW) share price frozen? appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!