Boutique fund Hyperion Flagship Investments (HIP) announced yesterday it had suspended its proposed share buyback and instead opted to raise a further $30 million from investors.
The money will be used to broaden the shareholder base, improve liquidity and to substantially expand the company's portfolio, according to the firm's letter to shareholders.
HIP said the plan to buy back 1.7 million shares had been suspended until after the offer was finalised and the new shares issued.
The capital raising is subject to approval at the next shareholder meeting on August 9 and will be open to existing shareholders and the public.
This is the first time that shares in HIP, which listed on the Australian Securities Exchange (ASX) in December 2000, have been available publicly.
HIP managing director Manny Pohl said the raising would enable the firm to make further investments and obtain greater scale for shareholders.
"HIP gives retail investors a unique opportunity to obtain exposure to a diversified portfolio of Australian equities with the proven outperformance of Hyperion Asset Management as manager," he said.
Existing shareholders as at the day before the prospectus is lodged will have priority for up to one third of the total offer.
Hyperion Asset Management, which manages HIP, said that shareholders would get the volume weighted average market price for the last five days prior to the date of the prospectus.
Shares in HIP were trading at $2.12 by afternoon trading on Monday. They have jumped 35 per cent since July last year when they were trading at $1.65.
