PWK raises $16m

PWK came out of a trading halt today announcing that they had raised $16m through the placement of 5,000,000 shares with institutional shareholders. Together with the recently ANZ debt facility the company now has access to close to $40m in capital. Last week I stated that this gave a green light for project Runway, In a nutshell, I was wrong. The placement was done through Wilson HTM corporate finance and thus as ANZIB have been appointed as the financial advisor for project runway these funds were raised for other reasons:

"the directors believe that the company is very well-placed to take advantage of strategic opportunities such as the proposed international fibre network to Guam (project Runway) and to leverage its considerable fibre optic network and internet peering base and partnerships with new domestic and international products."
If that all sounds a bit vague to you I agree. The announcement stopped short of giving the green light to project Runway. In a phone call with the CFO today he stated that the funds could certainly be used to 'kickstart' project runway or they may be used for other emerging opportunities. He reiterated that the board is very confident with the progress made on project Runway to date however because of the considerable size and cost of the project they want to get all their ducks in a row before making an announcement to the market.

The next few months is shaping up as an interesting period for PWK. The market is anxiously awaiting the green light on project Runway. Also as alluded to today PWK is looking at other growth opportunities and we should expect an earnings guidance update for 2007 sometime in the near future as well.