Companies: AI.   

Aerospace procurement and inventory manager Aero Inventory is raising a hefty £92 million through a rights issue and placing.

JP Morgan Cazenove, AIM-quoted Aero's newly appointed nominated adviser and broker has fully underwritten the fundraising, which is pitched to enable the company to pursue 'a number of business opportunities'. These include the possible appointment of Aero as one of only two 'nominated service providers' to the Airbus civil airline manufacturing giant.

Aero is raising more than its present £81 million stock market value with this funding, which comes in the form of an £84.9 million three-for-two rights issue and a £7.4 million placing. The rights issue is priced at £3, a 33 per cent discount to yesterday's 451p closing price, and the placing is at 433p.

Chief executive Rupert Lewin hopes that the funding proceeds will also stimulate the company's growth by enabling Aero to increase its access to debt. Assuming an 80 per cent gearing level permitted under its present banking facilities, he reckons the company will now be able to tap more than £158 million of finance to fund growth.

Aero Inventory boosted pre-tax profits from £1.7 million to £7.2 million on doubled turnover of £43.6 million, and its shares have fluctuated between 289p in December 2004 and 502.5p last September. They are 21.5p up today and 472.5p and could go further.