Chamberlin PLC shares sank on Tuesday after the company announced it had conducted a fundraise through a discounted placement to strengthen its balance sheet.

Shares in the West Midlands-based specialist castings and engineering group were down 29% at 2.03 pence each in London on Tuesday morning.

The company said it raised £830,000 via placing 41.7 million new shares at a price of 2.0 pence each, a discount of 30% to Chamberlin’s mid-market closing price of 2.85 pence on January 8.

Chamberlin said 10.2 million of the placing shares were for Executive Director Trevor Brown alongside other investors.

Proceeds from the fundraise will be used to provide working capital and strengthen the group’s balance sheet in support of its growth strategy, the company said.

Applications have been made for trading of the new shares on the AIM market of the London Stock Exchange, and Chamberlin expects these to be admitted on January 15.

Cavendish Capital Markets Ltd acted as joint broker to the placing alongside Peterhouse Capital Ltd.

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